Support for Mortgage Interest Discussion Area

antrobus

poppy10 wrote: »

The government don't borrow from the Bank of England
They issue bonds (gilts) and the average rate that the government pay on these is 1.7% at present. The government is giving you the loan at the same rate that they are currently able to borrow from the wider market.

The Debt Management Office manages the government's borrowing.

Current Gilt yield can be found here.
https://www.bloomberg.com/markets/rates-bonds/government-bonds/uk

Auntiemogs

If there's no equity in the property, then upon transfer of the title the loan is written off.....

Lapadore16

Hi All
Need some information about the changes from April 2018 for the support for mortgage interest payment.
It is being changed into a loan that has to be repaid back when the house is sold or when the unemployed find a job.
What I want to know is what Martin thinks of it? Is it a good deal to accept the loan?
I have the forms ready to fill in but need to know if this is a better deal to repay at a future date.
Thanks

Auntiemogs

skcollobcat10 wrote: »

Wouldn't they just wait until owner passes away to get return of loan?

Some people may wish to move, either to downsize, or to a property more suitable for their needs or closer to family.
The change covers not just people on pension credit, but those who are long-term unemployed and those (like myself) who took out a mortgage when they were working but are now unable to work due to illness/disability.
Sadly, by the time that the loan is repaid, these options may no longer be viable....

poppy10_2

Lapadore16 wrote: »

Hi All
Need some information about the changes from April 2018 for the support for mortgage interest payment.
It is being changed into a loan that has to be repaid back when the house is sold or when the unemployed find a job.
What I want to know is what Martin thinks of it? Is it a good deal to accept the loan?
I have the forms ready to fill in but need to know if this is a better deal to repay at a future date.
Thanks

If you are able to pay your mortgage without the loan then it is better to do so
It’s a cheap loan – is it a problem?

You probably don’t have any better options (see below). But this loan from the government isn’t good news for two groups of claimants:

• if you are only temporarily out of work – perhaps while your children are very young or until you find another job – then having this secured loan will reduce your equity and make it harder for you to remortgage at a good rate in future.
• if you are a pensioner with an interest-only loan, you may have been hoping your equity will build up over the next few years until your mortgage ends. This SMI loan will reduce the chance of that working.

At the moment, mortgage companies are slow to repossess a house if there are mortgage arrears. It is possible that if you don’t have a lot of equity, this secured loan will mean your mortgage company may decide to repossess sooner… but it will be a while until it’s clear if this is a problem or not.

Should you agree to this?
Although it’s not good, in practice most people won’t have a better alternative to this government loan:

• it will be at a lower interest rate than you could get from banks or other commercial lenders;
• as you don’t have a job, there are unlikely to be any options involving remortgaging that would help;
• if you don’t take the loan and just let mortgage arrears accumulate, your house is likely to be repossessed;
• you don’t have to make any repayments to this loan, even if you start work.

So unless you have savings you could use or there are relatives who could help you, you probably should take it. If you are unsure, go to your local Citizens Advice and ask for their assistance, to look not just at this loan but at the rest of your situation: benefits, other debts etc.

tt47

I get the SMI payment, albeit a tiny amount, but it seriously helps. problem is, I have health problems and my anxiety is through the roof atm. I have needed to go back to my gp and have an appointment with CAB soon too, to discuss matters. Now, I live in Wales and my house isn't worth that much, so when I sell (because I want to, not because I will eventually be forced to) I will have to pay off my mortgage, the agents, solicitors and removals. But with this new scheme I will have another payout on top. Leaving me with probably enough to buy a shed. So, could I ask all you lovely people,, in the same predicament, to sign and share as much as possible to get this re-looked at by parliament as I don't think they've thought this through enough.
As I am unable to post the link, you can find it under the gov. website.
Stop mortgage interest support benefit changes. - Petitions

assist123

I have a shared mortgage with joint tenancy severed. I'm having difficulty paying mortgage. Am I eligible for any help reducing or delaying mortgage payments. I am in financial difficulty due to mental health and incapability to work. So shock to my income. I may loose my home as no longer able to get help off my ex with mortgage payments.  I am liable to pay full mortgage. Its my only property and i have no savings. I'm currently living in the property. What help can I get as cannot get free rent on my benefits due to having a mortgage

assist123

Can I claim for my interest to be paid. Or pay interest only and delay my monthly payments. Am I entitled to SMI . Can we sell the government a 20% of property on buy back scheme. Or sell them  just a 10% share that I can rent from them and chance to buy back at a later date. As my mortgage monthly payments will be lowered for long enough for me to get back into work to buy back

assist123

Either would be better than selling property and being homeless. Want to leave house to our son eventually. So selling isn't an option. We own 80% of mortgage so far so have equity in it. Can we release equity if under 50

assist123

As we are past our redemption date and could save through interest but loaning money to overpay ends up costing more in borrowing and evens out same as mortgage payments so none the better short term