There are many types of benefits to which a disabled person may be entitled. Your client should consult a welfare benefits specialist, via their local Citizens Advice Bureau, to check their entitlement. The benefits important for home buying can be split into two groups:
Disabled people receive specific benefits, which may or may not be reliant on income levels. Some severely disabled people, or households containing more than one person in receipt of disability benefits, may have a high household income. In this case it may be possible to use their disability benefit income to repay a mortgage.
In certain circumstances mortgage interest payments, and other housing costs, can be included as part of an Income Support, Income Related Employment and Support Allowance (IRESA), Income Based Job Seekers Allowance (IBJSA) or Pension Credit (with guarantee credit) claim. This entitlement is known as an Support for Mortgage Interest (SMI) payment.
Usually SMI payments can only be claimed on mortgages or loans taken out before a claim for one of the SMI eligible benefits above is made. There are, however, specific circumstances in which a disabled person can take out a mortgage or loan to cover housing costs as part of new claim, or after a claim has been made.
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