Support for mortgage interest (SMI) extended AGAIN

Graham_Devon

StevieJ wrote: »

So what would that be a tent in a field, or maybe the workhouse, maybe a holding centre. I am interested where should people who lose their job live?

Theres a few options.

Government takes a stake in the house. They are already doing this for FTB's. We are afterall, paying a stake of the mortgage.

Government buys house and treats it as council owned, paying off the mortgage holders, who can then rent the house back with their proceeds should they wish.

Government take the SMI money back at a later date, just like they take student loans back etc.

Just stop paying SMI at 18 months. No one really has issue with SMI. It's the continual payments, even up to 3 years. Disabled already get it paid for life. No problems with that.

But 2 years is a long time to sort finances out. If you STILL can't afford your house after that time period, surely it's time to look at alternatives, rather than just extending it yet again.

Can you argue with the paragraph above? Yes or no?

We will literally soon have people finishing their mortgages with the taxpayer having collectively paid off say 20% of their mortgage for them. The longer it's extended, the bigger the chunk of mortgage we pay off. The smaller the mortgage gets, the bigger the chunk of their mortgage repayment part we collectively pay each month, reducing their mortgage even quicker.

Orpheo

StevieJ wrote: »

So what would that be a tent in a field, or maybe the workhouse, maybe a holding centre. I am interested where should people who lose their job live?

At last. A sensible question. This is something that would be a matter for debate. Their living standards should be dignified and humane. In my opinion that means a decent, clean home, warmth, shelter and enough to eat. By home, I mean a house or flat for themselves and their family. They should receive support and funding to help them find a job (travel expenses, etc). Many people would think this harsh, many people would think this lenient.

StevieJ

Generali wrote: »

I think it is...

Plus necessary repairs, although the law doesn't apparently apply to Dev and his mates Maybe we should just look at cutting out all the fraud.

The remortgage also went on holidays and new cars. I guess as long as he proved he built a conservatory with the remortgage, he'll get it paid. I know for a fact the second remortgage went on a loft conversion, but he also bought a van. How do I know? He was looking at our old house, as that had its loft converted and they were the same houses, just 7 doors up. Ours was done before it was bought. The cars were also paid for, but I can't see people having paperwork going back years and years. Neither can I see the government going over it with a fine toothcomb.

https://forums.moneysavingexpert.com/discussion/comment/42153148#Comment_42153148

chucky

Generali wrote: »

That's not the same thing. As much as anything else, paying someone's mortgage interest indefinitely (as used to happen) creates a terrible trap for people where they simply can't afford to start their career again if they lose their job and are unemployed for a while as they can't afford to lose the mortgage interest payments.

Sometimes bad things happening to people can be good in the end.

i agree with you that nobody should be on SMI long term.

if they're on it long term i guess they're not really interested in getting a job a guess. these people are probably extremes though.

chucky

Orpheo wrote: »

No. They get a flat amount based on the size of their mortgage according to BOE's average mortgage rate which, I believe, is around 3.7%, it used to be 6% under labour; this means that if people are paying a lower interest rate than 3.7% on their mortgage then they also get their capital reduced. The taxpayer is buying their house for them.

actually i'd check what the average mortgage rate is. there are of course exceptions but it isn't 3.7%.

please try again.

Graham_Devon

Generali wrote: »

I think it is...

It's paid for any remortgages whereby the remortgage was taken for improvements to the house.

Thing is, theres no way of asking to show that every last penny was spent on a rennovation or improvement.

So say someone takes 40k out of the equity and builds a 30k extension. Spent 5k on a holiday, kept 5k back.....as most people would.

SMI would be paid on the 40k. There literally is no way, and I doubt, any interest in persuing for evidence that every penny was spent on the house.

The main point of SMI is to keep people in houses. Not spend ages going through years of accounts to find out where the 40k was actually spent. In itself, it would be a time consuming nightmare. Though may improve public sector employment.

StevieJ

Graham_Devon wrote: »

We will literally soon have people finishing their mortgages with the taxpayer having collectively paid off say 20% of their mortgage for them. The longer it's extended, the bigger the chunk of mortgage we pay off. The smaller the mortgage gets, the bigger the chunk of their mortgage repayment part we collectively pay each month, reducing their mortgage even quicker.

Then again many savers would suggest they are paying off part of your mortgage

Graham_Devon

StevieJ wrote: »

Plus necessary repairs, although the law doesn't apparently apply to Dev and his mates Maybe we should just look at cutting out all the fraud.

Instead of just trying to dig at every opportunity, how about answering my question?

Ive stated my case on another post. If you wish to disagree with it, then do so. But I'd need evidence that the government does indeed hunt down every single transaction from the remortgage for evidence it was spent on the house.

Now, suggesting that is indeed the case, is rather silly, isn't it.

chucky

Graham_Devon wrote: »

Semantics.

They can't afford the full repayments.

if you hadn't realised having your mortgage interest paid by SMI and having your mortgage interest and capital paid by SMI are two different things.

so when you say that SMI is paying mortgage interest and capital for people. you are wrong.

Graham_Devon wrote: »

No point in discussing anything, with your around, is there. Everything gets dumbed down to the point of stupidness.

this did make me laugh especially as you got it completely wrong

FTBFun

Surely paying someone's mortgage interest is more cost efficient than letting them be repossessed and then having to house via social housing or privately with housing benefit?

I agree it should not affect capital at all.