Government Mortgage Interest Support Scheme & Benefits

leisacurry

Both my husband and I have both recently been made redundant and although I am entitled to redundancy money, I will not receive it for some time as the company have gone into Administration.

The scheme seems a good idea and could have really helped us had we been eligable.

Both my husband and I have been granted Job Seekers allowance but Contributions based not income based, as we have no income and we have worked continually until now.

We are told that we do not qualify for the scheme because Contribution based is not eligable, we have to stay on contributions based for 26 weeks before it will change to income based, then we have to wait 13 weeks further before we can qualify for the scheme, this means that we have to wait a whole 39 weeks (nearly 9 months) before we can get help.

Our combined income through benefits is £158 per week and our mortgage is £930 per month.

The lender has offered to let us pay the interest only for 3 payments at £650 per month, but that the capital we had not paid during this 3 month period would be added to the remainder of the term.

After the 3 payment agreement expires (and as we owe this months money next week, its more like two months til expiry) the lender will expect us to pay the normal monthly payment, plus the extra capital added otherwise they will start proceedings to reposses.

Does anyone know of a way of getting around this before we loose the house, our small children, my husband and I love?

dunstonh

The Govt scheme is to act as a last resort. It isnt there to replace insurance protection and personal savings. If it was then no-one would save and people wouldnt take out the insurance protection. So it shouldnt be relied on as a replacement to personal responsbility. Its a bit late in your case to realise that but thats how it is.

As we are about to enter a new tax year and your income is going to be virtually zero, then you should be able to apply for tax credits. This could potentially get you into the £8000-£10,000 range.

Also, the lender will not start repossession after just one months arrears. They typically start after 2 or 3 and nowadays 3 or 4 and even then they have to go to court and a judge has to agree it. If your prospects have much improved by the time it gets that far then a judge would not allow it to happen. So, that should buy you some time to find employment. If your prospects are poor then consider selling up whilst you have some equity and getting a sale on your terms and not the lenders and get some equity back in your pocket whilst you can.

In the meantime you cut down your expenditure to as little as possible and probably a good idea to head to the debt free wannabee forum as they have some very good posters in there who will give you a lot of help.

SouthCoast

And more info here:

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/ManagingDebt/DebtsAndArrears/DG_10013261