URGENT Changes to Morgage Interest Support [merged]

dave030445

ilovemydebts wrote: »

the important thing to remember this benefit is to help pay your mortgage interest, not your mortgage!. I to got the letter today, hopefully it will cover the interest, or rather the 80% of the interest which according to the mortgage comp is important .When it was set at 6% there were people doing well out of the rate not it has dropped some will still be doing ok and others not, swings and roundabouts. They will never set payments out accorfing to your own situations as far to costly and in the current financial stitution we are in thanks to the spend spend and worry about it later government, good old labour government, noone will sign off on spending a fortune to appease the few.

Lucky you im short my £80 a week. I agree that at 6% some people would of been doing well out of it, like yourself. They should speak to your lender to find out what interest rate you are on and pay that then no one would gain and no one would have a short fall the money they would save would be loads and no one would have to loss there homes just like rent everyone has different rent amounts

mitchaa

To be fair about time this happened. The BOE BR has been 0.5% for 18mths or so now and most will be on tracker rates well below the 6% they were receiving. This in effect meant that the ISMI payments were overpaying their mortgage or at least paying the repayment part.

3.7% or whatever it is, is better than nothing so people should stop complaining and be grateful that the government are giving them money which to be fair benefits the claimant by awarding them with an expensive asset at the end of it funded and paid for by the taxpayer.

The 104wk limit for JSA claimants is an excellent move. The hard working taxpayer should not be held to ransom by someone too lazy and bone idle to work. At 104wks there is no excuse for not securing employment.

dave030445

mitchaa wrote: »

To be fair about time this happened. The BOE BR has been 0.5% for 18mths or so now and most will be on tracker rates well below the 6% they were receiving. This in effect meant that the ISMI payments were overpaying their mortgage or at least paying the repayment part.

3.1% or whatever it is, is better than nothing so people should stop complaining and be grateful that the government are giving them money which to be fair benefits the claimant by awarding them with an expensive asset funded and paid for by the taxpayer.

The 104wk limit for JSA claimants is an excellent move. The hard working taxpayer should not be held to ransom by someone too lazy and bone idle to work. At 104wks there is no excuse for not securing employment.

what about the disabled that would love to go back to work.
Yes it is better then nothing but still doesnt stop your house being taken from you.

tcr_3

Dave, if you're down £80pw as a result of this change that'd mean your outstanding mortgage must be in the region of £180,000 or thereabouts ? Are you sure the shortfall's just interest ?

dave030445

Yes im sure its just interest yes we have a large outstanding amount

andyandflo

dave030445 wrote: »

Lucky you im short my £80 a week. I agree that at 6% some people would of been doing well out of it, like yourself. They should speak to your lender to find out what interest rate you are on and pay that then no one would gain and no one would have a short fall the money they would save would be loads and no one would have to loss there homes just like rent everyone has different rent amounts

Hi that used to be the case years ago. The payments were then matched to what you were actually paying.

The problem with that system, with every change for every claimant, they had to review the amount paid. They then came up with the idea, based on a formulae which worked out to 6.08% for everyone. A nice cheap alternative. And in the meantime most were getting the whole of the interest paid and a good proportion were getting overpayments which were used then to reduce the capital.
That scheme I believe was to run to early next year.

Now that there has to be savings they have re-looked at the amount and % rate again. Their spin on it is that if it was left until next year, the formulae being used would only have given a rate of just over 2% because of the low base rate. So the sweetie in the jar is that they have brought forward the review to Oct 2010 to give you more than what you would have got next year - over 1% more!!!

Don't you think that that is nice of them?

Gip_3

I'm on income based, lost my job through redundancy and I got the letters yesterday which means my shortfall is about £50 per week. It's not as if I'm sitting on my backside and not trying to get a job, because I am. But this is all starting to take its toll and I keep having panic attack after panic attack as well as little or no sleep.

I'm writing to my lender today. I'm not and never have been in arrears. It would cost more for me to be rehomed if I was repossessed. Rents here exceed the amount of MI that I get and all in all, I really don't think that I could cope mentally or emotionally with it all. I've thought about taking in a lodger, but that impacts of CTB and income, even though I'd not be making anything from it. Just keeping a roof over my head.

I can understand how the stupidity of the labour administration has caused this, but these severe and ill thought out changes are going to cause severe hardship to many. I'm also going to write to my MP, but I don't hold out much hope there.

It's not as if I live outside my means. I don't drink or smoke and I've paid taxes for years. How they expect me to concentrate on a job search with this sword of Damocles hanging over my head, I don't know. I don't want any pity. I want a job and I'm a qualified professional. But I'm told by agencies that there are at least 25 - 50 people going for each vacancy.

I'd work in a bar or wait tables if I wasn't clobbered with excessive council tax or high tax rates for low income. Despite the fact that I'm professionally qualified and all the recruitment agents I've spoken to have said that doing something like that would be detrimental to me rather than helpful.

Talk about being caught between a rock and a hard place. If anyone has any tips or suggestions, I'd gladly listen.

Gip

TOBRUK

In many cases the amount of help given through SMI payments don't cover the interest! Currently I am receiving £41 a week every 4 weeks (paid in arrears) - this works out at £177.66 a month for INTEREST. If I was renting this property the rent would be £500 per month. I haven't had the new figures yet but I think I shall be receiving around £20 a week help with interest payments - where would I get a rental for £20 per week?!

Before someone says sell the house and live off the proceeds - many are in negative equity and they would not have any money through selling. Many will lose their homes and when they move into a rental accomodation (if they can find one as there won't be many if this happens) they will have to pay out more! Then what happens when they cut rent payments .... will there be an increase of homeless people and if so where will they live?

When I bought the house I was in full time employment and was fit and well. I did not then think I would end up being physically disabled, having an illness and unable to work. When I had to leave work there was no help at all for the first 39 weeks!

Trying to pay the mortgage is a constant worry. It is difficult if on a variable as you don't know what is happening but then going on fixed rate is usually more and then worrying again when that fixed rate ends! There is also the worries which I would not have if renting - of upkeep, repairs, annual boiler service, building insurance etc.

mitchaa

dave030445 wrote: »

if you are going to comment get your facts right they are not buying your house and stop being silly they are simply paying the interest you still have the same about of morgtage left.

If I take out a £150k mortgage today, it is likely I'll pay £300k back with interest. In 25yrs time the house may have trebled in value so I have made a profit of £150k in growth over 25yrs.

If you take out a £150k mortgage today and become disabled tomorrow. You pay £150k back and at the end of the 25yr term you have made a profit of £300k in growth over 25yrs.

With the 6.08% payments over the last few years and the low interest rates that the majority of people will have been put onto, aswell as getting the interest portion paid off in full, a portion or perhaps all of the repayment part was getting paid off aswell. So you may only pay £75k out of your own pocket, compared to the £300k I have to pay to have the same £450k house at the end of it in 25yrs time.

How is that fair? No wonder the country is skint, I wish the government paid off my mortgage for me.

Not all, but certainly a great number of those receiving ISMI can work but for reasons unbeknown they choose not too. I have a friend who is classed as disabled as he only has 1 foot. He gets high rate mobility and middle rate care and will do for the rest of his life but yet he can easily work if he wanted too, sit in a call centre, become a driver, a whole host of jobs are available to him but he doesn't need to as he can hide behind the benefits system. (Trust me, he can walk for miles on his prosthetic limb as I go golfing with him every couple of months)

He could potentially get a job tomorrow, sign up for a £200k mortgage, pack in the job a few weeks later and get the government to pay off his mortgage for him, (Or a great portion anyway 50%+) In 25yrs time, he can sell the house and bank all the profit courtesy of the hard working taxpayer.

The system is very unfair and should be time limited to 3-5yrs maximum in my opinion.

dmg24

Can I remind people that this board is for helping people on benefits, not for discussing the rights and wrongs of government policy.

I shall ask the Abuse Team to look at this thread as it is going off topic. In the meantime, if anybody wishes to delete their own posts which are off topic (so as to save the MSE Team's time) they can do so by clicking the Edit button on their posts.