Selling house and housing benefit sanction

Hello

My client has informed me that he is selling his house, and plans to move into rented accommodation. He is in negative equity so will not have capital when he sells, just a bigger debt, he plans go go bankrupt once moved. I seem to remember something about the possibility of a sanction of HB/LHA if you move from owner occupier to rented. Client is on ESA, he is not under threat of eviction, his mortgage company are receiving ISMI and are not taking any legal action, client does not qualify for mortgage rescue as leasehold.

Are you thinking of the former owner rule? It only applies where the renter previously owned the same house. Nothing in your post stands out to me as a barrier to claiming HB.

Many thanks for the reply, you are absolutely right I was getting confused with former owner rules.