Support for Mortgage Interest Changes

Wutang_2

andyandflo wrote: »

Hi, I'm not on a downer at all! I could turn this round and ask what can I do given my circumstances to get help towards my mortgage interest!

I accept the fact that what happened - happened and there is no way given all of the will in the world that the law can be changed. Your point that I seem to be missing in that there are others on a higher rate than they will receive help for in the future is not correct. Yes it will affect them but nowhere near the FULL amount I have to pay!

If you can't pay the mortgage - you lose the house! I'm sorry if that seems hard, but I have managed to pay my £90 of weekly interest every month out of the £202 pw I get from Pension Credit.
Is that fair - no it is not, but as I said - it's life - I have just got to get on with it or move into rented!

All that I am saying is - flipping the coin - those that have had help at 6.08% in the past AND their actual rate is lower, have had an advantage over those that have had to borrow at more than 6.08%.
What I was trying to make a point of, was that THOSE people should not be complaining now with the rate going lower to match those suffering in the past!

Do I believe that the excess that has been paid out in the past will be returned by the borrower to the Government - no I don't, it has been used to reduce the capital debt.

We are now entering a more level playing field than that this system has allowed to happen in the past. Of course there will be losers, but hopefully no winners, it is not fair to the thousands of hard working people where others have had the interest AND some capital paid each month.
There should be a maximum - either the rate as the Government is now setting OR the actual amount due if lower!!!

You can't seriously expect the Government to meet all of the interest for everybody even if the rate they pay is greater than the normal borrowing rate. In other words, those that have had to borrow at a high rate for whatever reason, bad credit rate, debts etc, should have public money to cover it!!

AND no there are no sour grapes - I accept life and what it throws at me. You win - you lose - name of the game!!
If you can't afford something you either sell it, return it or find a way of paying for it. You would with a car on finance so what is the difference between that and a property?

Start a new thread you nutbar

[Deleted User]

citizen11 wrote: »

What luck that individuals adversely affected by this change in policy have this 4 month warning now to sell their property to someone that can afford to service the debt. They can then move into to rented accommodation more appropriate to their financial circumstances.

There is considerable moral hazard in the state paying to service the debts secured against an individuals assets. I rent because I cannot afford a house yet the state will pay for a privileged few to own one.

This is an extremely positive move and one the coalition should be applauded for.

what total and utter b**lox,you say you rent,so if you lost your job they would pay most of your rent for you,if you had a mortgage they will only pay the interest at the rate they dictate,you have to pay the repayment part plus and insurance for the mortgage.
There is alot of genuine misconception about SMI and then there is alot of pig ignorance.

theworldsgonemad

citizen11 wrote: »

what luck that individuals adversely affected by this change in policy have this 4 month warning now to sell their property to someone that can afford to service the debt. They can then move into to rented accommodation more appropriate to their financial circumstances.

There is considerable moral hazard in the state paying to service the debts secured against an individuals assets. I rent because i cannot afford a house yet the state will pay for a privileged few to own one.

This is an extremely positive move and one the coalition should be applauded for.

troll alert

Kirri

Usually_Angry wrote: »

Of course one aspect of that minimum standard should be having a roof over your head - and if you have a family, I'd argue a stable roof over your head.

But no real reason that should be coming from a subsidised mortgage. You realise who are really being subsidised here, right? Isn't claimants. It's reckless mortgage lenders.

What about all the people that get rent covered after losing their job? which is paid out 13 weeks before anyone with a mortgage gets help... Would you like to see the end of housing benefit as well as SMI?

citizen11

woodbine wrote: »

what total and utter b**lox,you say you rent,so if you lost your job they would pay most of your rent for you,if you had a mortgage they will only pay the interest at the rate they dictate,you have to pay the repayment part plus and insurance for the mortgage.
There is alot of genuine misconception about SMI and then there is alot of pig ignorance.

No in actual fact they wouldn't pay a penny toward my rent. I have saved what is considered to be a considerable sum for a deposit ( it has to be considerable because the housing market is not a free market with interventions like overly generous SMI) I would have to wait until my own funds are exhausted before receiving any help, I would then have to move to a smaller house as well because of my bedroom entitlement.

I would lose all my wealth, my standard of living would fall through the floor. Not just have to be careful on the weekly shop.

On the other hand if all my wealth was in the equity of a property on which I had also secured a loan I could no longer afford then my wealth would be preserved by SMI until the good times rolled for me again.

People not old enough to buy a house when they were reasonably priced or get social housing when it was widely available (which they could then buy cheap!) are disadvantaged by benefits like SMI as it stops forced sales, which although painful for those forced to sell should be a fact of life in a meritocracy. In fact those selling are likely to have made alot of money by owning the property, as have the people receiving SMI over the last year when prices rose 10%, making the average homeowner around 15K. Nice work if you can get on the gravy train

No security of tenure negatively impacts quality of life when you are raising a family, older people simply didn't have to endure it.

Kirri

Usually_Angry wrote: »

Of course not. Stability makes more sense than ineffective discentivisation in such cases.

No job after a year? Well, you've had a year to prepare for it...

But if people have property repossessed then the resultant cost in housing benefit/emergency accommodation/finding them social housing which could be more expense than the previous mortgage cost and that is better? Would you really think the same if that was you losing your job?

dmg24

I get the feeling we have two people on this thread who are one and the same, and hopefully they will both be gone by morning!

anmarj, thank you for the info.

The current low BoE rate does concern me, and I would be interested to know how they are calculating this 'average' (I feel a FOIA request coming on!). I have had a quick browse of rates currently available and I can only find two below the 'average' rate which are available to those with higher than 70% LTV. Also, any longer term claimants will find it near impossible to remortgage to such a good rate even if they did meet the LTV criteria. It will be interesting to see how this unfolds.

andyandflo

woodbine wrote: »

what total and utter b**lox,you say you rent,so if you lost your job they would pay most of your rent for you,if you had a mortgage they will only pay the interest at the rate they dictate,you have to pay the repayment part plus and insurance for the mortgage.
There is alot of genuine misconception about SMI and then there is alot of pig ignorance.

Yes of course they would pay the appropriate amount of rent as 'housing costs'.
But the claimant in this situation does NOT have investment in the property - only the landlord does.
So why should we pay towards a mortgage that the claimant HAS investment in.
I would not argue that there should be support given in both cases and to me, quite honestly the mortgage interest payments made by the state should be no more than what they would have paid out in Housing Benefit for an 'appropriate property', given the size of their family.
That way there would be equality and if the homeowner could not cough up the difference to the bank then, as the other postie said, sell, rent and give somebody else the chance to purchase the property for which THEY could afford to maintain.

citizen11

andyandflo wrote: »

Yes of course they would pay the appropriate amount of rent as 'housing costs'.
But the claimant in this situation does NOT have investment in the property - only the landlord does.
So why should we pay towards a mortgage that the claimant HAS investment in.
I would not argue that there should be support given in both cases and to me, quite honestly the mortgage interest payments made by the state should be no more than what they would have paid out in Housing Benefit for an 'appropriate property', given the size of their family.
That way there would be equality and if the homeowner could not cough up the difference to the bank then, as the other postie said, sell, rent and give somebody else the chance to purchase the property for which THEY could afford to maintain.

That would be an excellent idea, SMI payment arrived at by calculation of bedroom entitlement and market rents, same as LHA. True fairness.

Though in general I disagree with LHA as it puts a floor under rents therefore anti market. People , even in low paid work, should be able to afford better accommodation those those not working, that should be a guiding principle.

And whoever said it, this other poster is not me. I acknowledge that the adjustment to SMI is bad news for some. However it also great news for others!

andyandflo

Sorry to be blunt - I come from an age (61 yrs) when you were taught that if you could not afford it - you didn't get it.
so, even if you have equity in your home but still can't afford it, SELL the damn thing and rent elsewhere. No you wouldn't get housing benefit until you had depleted your capital. But what gives you the right to hold on to the equity? (It's mine and I worked for it! - tell that to the pensioners that have lost everything when their company pension scheme folded and got nothing!!) We all have to face pain at sometime in our life and that is all it is - short term pain!!