Thanks for the replies, I have a further question relating to the situation, Would it be detrimental to any claim for housing benefit if the house was sold to another family member at the market rate, would this be looked at in a housing benefit application unfavourably or is it not relevant? Thanks in advance for any replies.

Hi I would just like peoples opinion on whether my parents would be entitled to housing benefit. They are currently living in their own property which is mortgaged with an interest only mortgage and they have no endowment or any savings to pay back the mortgage. The mortgage is due to end in the next 12 months and then they will be expected to repay it. They owe £55k on the mortgage and the house is currently worth £120K. They owe about £60k-70k on credit cards and other loans and are both retired, my mother is also disabled and gets higher rate mobility and some other benefits (not 100% sure of these, used to be severe disablement allowance I think, not sure what it is called now), both my parents get pension credit guarantee. Their current mortgage interest payments are being paid directly by the DWP from their pension credit. So my question would be if they sold their house and paid off their debts would they be able to rent a house privately and claim housing benefit? Or would they not be entitled to it because they have sold their house? My other idea for them was to ask for a council house but when they enquired about a council house they were told that they couldn't get one unless they were homeless and the council would treat their situation as making themselves intentionally homeless. Any thoughts on this would be greatly appreciated, thanks