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Debate House Prices
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Mortgage interest support
Comments
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You've still got to pay off the capital sooner or later so, I suppose, it catches up with you eventually and maybe the fall is harder, the older someone is.
That may be the case but I'm not so sure. With more 50 years+ workers facing redundancy, there will be increasing numbers of older workers who have not finished their mortgages and who will not get back into work imo.
I think you could be right I believe that quite a few claimants are pensioners, but in a lot if not most of the cases the amount of interest will probably be quite low and as you say the bank will want the capital at some stage.0 -
I've always found this scheme to be abhorrent, how can it be right to use tax payers money (many of whom can't afford a house) to artificially keep prices high and stop the market correcting.
In every free market, you have the chance of winning and losing, apart from the UK housing market, where you seemingly borrow far more than you can possibly afford knowing that when it all goes t!ts up, you'll be bailed out by the government at the cost of every prudent person in the country.
The ultimate in moral hazard.
I think the point is being missed Ad. First, you have to be in receipt of a qualifying benefit to recieve SMI. To maintain entitlement, you have to continue being entitled to the qualifying benefit (income support, JSA or ESA).
It only covers interest payments, not the capital repayments, which the OO remains liable for, so in reality, arrears are likely to accrue anyway.
Plus this scheme already existed. hat happened is that the government extended it, allowing more people to qualify.You could get your mortgage interest paid in the 80s.I believe that prior to 1987 mortgage interest payments were paid strait way, then only 50% was paid for the first 16 weeks. Then in 1995 the 39-week wait was introduced.
You are quite right. In the 90's, with the advent of PPI, the qualifying period for what is called SMI was extended to 39 weeks for everyone. I remember doing an evidence report as part of a campaign on the unfairness of this for certain sectors of society. I can still recall Gordon Brown as chancellor announcing that people over 60 would not have to wait for this length of time, as usually they lose/gain entitlement to these means tested benefits (& household income rapidly changes) when their partner goes into hospital.Provided you qualify for income related benefits, looks as if it goes on indefinitely...
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/BenefitsTaxCreditsAndOtherSupport/On_a_low_income/DG_180321
Quite correct treliac. You are also quite correct that it only covers INTEREST, a fact frequently missed. It isn't their mortgage being paid, it is the interest. The reasoning for this is it is not deemed appropriate for the welfare state to be purchasing the asset directly for you, hence interest payments only. In reality it buys a lot of people the time to either a) find another job, by which time they can start paying off any arrears that have built up, or b) put the house on the market & sell it.
As an interesting aside, it appears that those in the private sector would have had this assistance, whereas with all the public sector cuts & associated job losses coming, public sector staff made redundant won't get it. That doesn't seem very fair does it?
As another aside, how would the uproar sound if renters got assistance, but OO's got nothing? I can only imagine some of the threads on here if that were to be the case....It's getting harder & harder to keep the government in the manner to which they have become accustomed.0 -
I think people are more likely to be claiming LHA long term than SMI.
I'd agree with this. In my experience, I will daily come into contact with numerous people who are in receipt of some hb/LHA, or have their full rent paid. By means of contrast, people in receipt of SMI, I'd say less than 1 a month (and my job involves advising people on such matters, amongst others).You've still got to pay off the capital sooner or later so, I suppose, it catches up with you eventually and maybe the fall is harder, the older someone is.
That may be the case but I'm not so sure. With more 50 years+ workers facing redundancy, there will be increasing numbers of older workers who have not finished their mortgages and who will not get back into work imo.
Very eloquent and valid point treliac, & worthy of consideration. As I've said in my post above, imagine if there was no assistance whatsoever for owners & it was restricted to renters. We have seen large scale redundancies in the past 2 years. We are expecting more over the next 2 years. We are hoping for job creation too, but there are many who doubt the pace of job creation. A lot of thos made redundant will fit in the criteria you have outlined. Sadly, many of them will be massively concerned about finding work again. Are posters really suggesting we give them no support at all? When they have worked, paid taxes etc for 20-30+ years? Is that reasonable?It's getting harder & harder to keep the government in the manner to which they have become accustomed.0 -
lemonjelly wrote: »I'd agree with this. In my experience, I will daily come into contact with numerous people who are in receipt of some hb/LHA, or have their full rent paid. By means of contrast, people in receipt of SMI, I'd say less than 1 a month (and my job involves advising people on such matters, amongst others).
Very eloquent and valid point treliac, & worthy of consideration. As I've said in my post above, imagine if there was no assistance whatsoever for owners & it was restricted to renters. We have seen large scale redundancies in the past 2 years. We are expecting more over the next 2 years. We are hoping for job creation too, but there are many who doubt the pace of job creation. A lot of thos made redundant will fit in the criteria you have outlined. Sadly, many of them will be massively concerned about finding work again. Are posters really suggesting we give them no support at all? When they have worked, paid taxes etc for 20-30+ years? Is that reasonable?
I think i'll change my plan. Get the biggest mortgage I can, spend the rest of my savings on fast cars and holidays, wait a couple of years until i'm 60 and see if i can join the SMI club.0 -
des_cartes wrote: »I think i'll change my plan. Get the biggest mortgage I can, spend the rest of my savings on fast cars and holidays, wait a couple of years until i'm 60 and see if i can join the SMI club.
That would involve banking on benefits laws being the same then as they are now...
Not sure whether that'd be a good idea or not.It's getting harder & harder to keep the government in the manner to which they have become accustomed.0 -
des_cartes wrote: »I think i'll change my plan. Get the biggest mortgage I can, spend the rest of my savings on fast cars and holidays, wait a couple of years until i'm 60 and see if i can join the SMI club.
You might still recieve too much pension to qualify for pension credit .....and i don't think there's any other benefit for a pensioner to have that qualifies them for SMI
(correct me if i'm wrong but that's how i've understood it)0 -
The thread necromancer strikes again.....“The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.
Belief in myths allows the comfort of opinion without the discomfort of thought.”
-- President John F. Kennedy”0
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