Support for mortgage interest benefit cut by thousands of pounds

olly300

carolt wrote: »

Two problems with the idea of superficial parity.

The first and most glaring is that neither are currently "cheap and cheerful" as you claim - they're both outrageously expensive, as my earlier posts pointed out.

Secondly, is the fact that in rental terms, you can only claim LHA according to your needs ie according to family size. (And yes, I know there are issues with how needs are defined for those on benefits, versus how they are blithely ignored for those of us in private rentals, who pay their own way, but the basic principle at least is there.) Whereas if you, as a single person, bought a huge 5 bedroom house you could neither need nor afford, by lying on your forms to get your mortgage, you can then be supported by the taxpayer for an extrememely long (possibly indefinite) time to remain in that house - a luxury the renter would not have. Plus no blooming landlord to deal with, your 'own' home - except paid for by the rest of us.

I think that those who claim help with mortgages should only be allowed to claim amounts based on their needs - not their aspirations. Same as applies to those renting.

Gosh you are jealous person.

In reality anyone in a 5 bedroom house on benefits for a long time is going to have serious problems.

Houses require money for maintenance - money which you don't have if you are on benefits for a long period. Have you seen an elderly person's house who has lived alone on a pension for years? Many people I know who have brought them have brought them have found them in bad condition.

PN who is actually working has indicated the problems you have if you are on a low income and have a house.

It's actually better for the person to get out of the house and get a flat rented for them courtesy of the tax payer. Though if they are old the money is normally spent on care fees.

Gorgeous_George

If the taxpayer is paying your mortgage they should own part of your house IMHO.

GG

StevieJ

Graham_Devon wrote: »

Why is it fairer though?

This isn't about house prices. It's about fairness, from the collective tax pot. You are looking at this from a house price point of view, and it's skewing your perception of it, I'm sure, as you personally want houses to keep their prices.



How is the situation fair, considering they both pay into the tax pot and both cannot afford to buy a house?

He did say this:

with the risk it might increase house prices instead

ukcarper

Graham_Devon wrote: »

Why is it fairer though?

This isn't about house prices. It's about fairness, from the collective tax pot. You are looking at this from a house price point of view, and it's skewing your perception of it, I'm sure, as you personally want houses to keep their prices.

Why should person A get their mortgage interest (and sometimes capital) paid from the tax pot, and get the benefit of the house at the end of the term.

Whereas person B gets rent only paid, and no benefit of any house, or anything they can take with them at the end of the term?

Both are taxpayers, both have families.

How is the situation fair, considering they both pay into the tax pot and both cannot afford to buy a house?

I don't care what happens to house prices I must admit I wouldn’t be happy if they crash 70% but I don’t think that is likely and I personal think the best way forward would be a period where house prices stay the same. But surely paying people high LHA doesn’t do anything to reduce house prices and in most cases all your are doing is paying the landlords mortgage plus a bit of profit.

silvercar

Graham_Devon wrote: »

Why is it fairer though?

This isn't about house prices. It's about fairness, from the collective tax pot. You are looking at this from a house price point of view, and it's skewing your perception of it, I'm sure, as you personally want houses to keep their prices.

Why should person A get their mortgage interest (and sometimes capital) paid from the tax pot, and get the benefit of the house at the end of the term.

Whereas person B gets rent only paid, and no benefit of any house, or anything they can take with them at the end of the term?

Both are taxpayers, both have families.

How is the situation fair, considering they both pay into the tax pot and both cannot afford to buy a house?

The objective is to keep people in their homes as they struggle to manage with the loss of income through these difficult times.

So if you pay a mortgage you get help with the interest on your mortgage.

If you pay rent you get help with your rent payments.

Now as many, many more renters are already in receipt of benefit to pay their housing costs there is already a system in place.

There was no real system for mortgage help. So they've devised one that is easy to calculate. It assumes that
(a) as a householder you should have some money set aside, so you don't get anything for the first 3 months.
(b) broadly speaking people pay roughly the same interest rate, so everyone gets the same rate.
(c) as LHA is limited in some way, so SMI is limited to the interest on 200k.

Again, the sole objective is to keep people in their homes as they struggle to manage with the loss of income through these difficult times.

Its not rocket science, don't try and overcomplicate things. Its there to allow people to remain in their homes. Nothing else.

Graham_Devon

Well this is just going to go round and round as no ones actually willing to discuss the actual fairness issue. Just willing to pull people up for wanting people chucked out of their homes, and just willing to state what it's for. Anything touching on disucssing the problems and fairness issues simply will not be discussed.

I assume you would all be perfectly happy with the government (or your tax) paying off peoples holiday debts, or credit card debts too, so they can keep their credit cards and lifestyle?

carolt

StevieJ wrote: »

I have told you a trillion times not to exaggerate

It was an extreme examle deliberately to look at the problems that can arise - I'm obviously not suggesting everyone claiming help with mortgage interest lives in a 5 bed house.

chucky

silvercar wrote: »

Its not rocket science, don't try and overcomplicate things. Its there to allow people to remain in their homes. Nothing else.

it never is - people don't seem to see the bigger picture

the blinkers and HPC mantra don't let them see things properly...

Graham_Devon

carolt wrote: »

It was an extreme examle deliberately to look at the problems that can arise - I'm obviously not suggesting everyone claiming help with mortgage interest lives in a 5 bed house.

Was no different to suggesting everyone claiming SMI is on an interest only mortgage. But hey, that's perfectly acceptable

chewmylegoff

Graham_Devon wrote: »

Whereas those who do not hold a vested interest, i.e. may just have a home or have to rent themselves, want to see an end to SMI after a set period, and an end to propping up owners who simply cannot afford what they have taken on, putting those people in the same boat as thousands of others who cannot afford a home.

i STRed in 2007 and I still haven't bought back in, so i have no vested interest in prices going anywhere but down, but i can do the simple maths that if paying someone's mortgage interest is cheaper than paying LHA for them to rent somewhere, then it is a solution that has merit.

however, as far as i know, there is no system which considers the cost of SMI vs LHA and makes a decision which benefit a person should get. therefore, although it is true that it may often be cheaper to pay SMI than LHA, it may well be the case that the reverse is sometimes true. there is no evidence that i am aware of that, overall, the existence of SMI is actually saving the tax payer any money. i suspect noone knows whether it is or not.

the cut seems reasonable enough to me though, i don't see any justification for maintaining the rate at 6%+.

i really do think that it would be fairer just to get the banks to flag all accounts where SMI applies, add up the numbers and send a monthly bill to whoever is paying, rather than just paying a flat rate to everyone.