I have a customer who has had her entitlement to Housing Benefit stopped as she has a property which is not up for sale. The problem arises because the mortgage outstanding on the property is £86k and the property has now been valued at £40k because of the state of disrepair. In a situation such as this can HB be paid without the property being put on the market?

Yes, it can.

Having a property on the market is only relevant for the purposes of disregards - and even then its not essential that a property be on the market, only that the claimant is 'taking steps' to dispose of it.

If it can't be disregarded, start back at reg 47 HB regs and the calculation of capital; which is the market value less 10% for the costs of sale and the amount of any encumbrance (mortgage) secured upon it.

Surely the client does not have a realisable asset, more of a £46k white elephant. As a matter of interest, on what income did she get HB in the first place? If she has a £86K mortgage outstanding, how is she paying it? If she isn't, then the whole question of possible assets takes care of itself.

I agree with Mike, subject to the proviso that all of this mortgage was actually secured on this property. If that is the case then the encumberance on the property clearly exceeds its value by some way and there is no capital to take account of.

You don't say who did the valuation; it is possible that the LA will want to do their own (via the Valuation Office Agency).

I don't know who did the valuation but the LA has now asked for the letter showing the valuation. The customer is coming in to see me this afternoon so I will find out a bit more then. Thanks for your replies so far

On valuations see R(JSA) 1/02.

The customer has been in and provided the valuation done by an estate agent. I have spoken to the LA and it looks as if they are happy with this and HB will go back into payment. Thanks for all your help.