SMI payment query.

AdamPD

Hi all, I'm in need of some advice.

My dad called up the pension service to find out how much would be paid each month for SMI, they claim they're only paying £4.50 a MONTH

How the heck can that be right? I get £124.98 a month for SMI, but my dad is only due £4.50?

The mortgage is split between three people
Total mortgage balance is £140,000
The interest on both parts of the mortgage (interest/repayment) is 4.24% for both loans (shows as two loans for some reason)
The total interest per month comes to £480.39
Repayment is £208.20

I get SMI for being on income support
He gets it for being on Pension credit

Any advice is appreciated.

anmarj

How SMI is calculated

The standard interest rate used to calculate SMI is currently 3.63 per cent.
From 1 October 2010 the standard interest rate is set at a level equal to the Bank of England’s published monthly average mortgage interest rate. The starting rate that applies from 1 October 2010 is 3.63 per cent (the rate published by the Bank of England on 31 August 2010)


he will get a third paid for his allowable share and it will be set at 3.63%, he does not get it a month, it is paid 4 weeky, his award letter should give him his weekly entitlement to SMI, the limit on PC is also £100k

AdamPD

Thanks, but I'm confused as to why his allocation is so low, and mine so high?

anmarj

he would have to check what he was allowed ie was it a remortgage if so what was the excess used for?, what was the orignal house purchased? you state that it shows as two loans, it may be that he could only be entitled to one part of the loan, the only way for sure is for him to call the pension credit people and find out from them what was allowed