Jodie Clifford, 20, of Mountcastle Park, said she faced the threat of eviction because she cannot afford the £750 private rent on the three-bedroom home she shared with her mum, Maureen Pitter.
The Stevenson College childcare student was told she was not entitled to the housing benefit which her mother received and would have to quit college and her part-time job to qualify.
Jodie, who receives a student bursary of £210 a month added to £120 from a job in a Fort Kinnaird shoe shop, said she had been left helpless.
Mum Maureen, 50, right, who had battled cancer on and off for the past three years, passed away at the family home after the disease returned in February this year.
Jodie said: “The last few weeks have been really tough for me after losing my mother. I couldn’t believe it when I spoke with a housing officer and he told that as the law stands I’d have to stop going to college in order to qualify for housing benefit.
“I don’t know what to do. I’ve got two sisters but they have young families and full houses and I don’t want to become a burden.
“I’ve never relied on benefits. I feel I’m being punished for going to work and trying to better myself.
“I understand that the council’s hands are tied on this but something should be done to stop unfair situations like this arising. It seems the only options I have are either temporary accommodation or a youth hostel.”
Jodie’s sister, Charlene Ramsey, 29, said: “She doesn’t need this kind of stress, our mum has just died. Surely there must be other options. She wants to get a respectable job but this government has so many barriers in the way.”
Kate Polson, chief executive of The Rock Trust, a young people’s homeless charity in the Capital, said that each year up to 400 young people are made homeless in the city. As the law stands, those over 19 who are in full-time further or higher education are not entitled to income support or housing benefit.
She said: “A fair number of these cases are like Jodie – young people who through the death of a parent or family breakdown suddenly find themselves faced with homelessness.
“Our advice is to straight away have a financial assessment carried out because there are ways to negotiate a way through it by way of bursaries, loans and grants.
“We would never encourage anyone to quit college. They should explore every avenue so that they remain in education but sometimes difficult decisions do need to be made.
“It’s a very unfair system and the law needs to be looked at.”
A council spokesman said: “The council and its partners can help people who are going through a crisis and face losing their home. A range of services provide advice and information to find a home they can afford and support them through difficult times.”