Housing benefit after a sale and rent back deal
This content applies to England only.
Housing laws vary between England and Scotland. Get advice relating to Scotland
Don’t rely on being able to claim housing benefit if you sell your house and rent it back, as you may not be eligible for support.
Can I get housing benefit after a sale and rent back deal?
Housing benefit will normally only be available if you cannot afford to stay in your home, and where you would otherwise have lost it if you had not entered into a sale and rent back agreement. You will need to show that selling your home was your only option.
For this reason, it is very important to get impartial advice before you sign up to a sale and rent back scheme. An adviser can make sure that you are not overlooking any other options that may be available. See our page on sale and rent back schemes for more information about how they work and use our directory to find agencies in your area that may be able to help you.
When can the council refuse to give me housing benefit?
If the housing benefit department of your local council thinks you had other options that would have allowed you to keep your home, but that you did not take advantage of these options, then they can reject your application for housing benefit.
Some of the options which you could have taken to avoid losing your home include taking out benefits such as:
- income support
- jobseekers allowance
- employment and support allowance, and
- state pension credit.
What evidence will I need to provide to show that I had to sell the property?
There are several ways of proving that you had to sell your home, this includes showing the council:
- letters from your mortgage lender about actions they were preparing to take to collect any arrears you owed them
- evidence of your income and expenditure from the time when you decided to sell
- proof of other factors
However, if you sold your home to pay off unsecured debts such as credit cards, or debts from a hire-purchase agreement, for example, then your council may decide to refuse your claim.
Can the council say that I sold my home in order to qualify for housing benefit?
After looking at the amount of capital (ie cash, savings and other assets) that you have, the next step is for the council to consider whether the main reason you sold your home was in order to become entitled to housing benefit. If they think this is the case, then they can refuse your claim for housing benefit.
The council will take the following factors into account when deciding whether you sold your home in order to qualify for housing benefit:
- your knowledge of the rules
- the nature and timing of the sale
- whether it was reasonable for you to sell your home under the circumstances.
What other factors will the council take into account?
If the council is satisfied that you had no option but to sell your home, they will then look at your savings and capital when calculating how much (if any) housing benefit you are entitled to. See our page on housing benefit calculations for more information.
Share your story
Our housing crisis is affecting millions of people across the country. The most effective way for Shelter to show just how bad things have got and how much needs to be done is by highlighting the real-life experiences of people around the country.
If you have had a bad housing experience you can help Shelter by sharing your story with us 
