SMI saves 250,000 familes from reposession in last 3 years

Graham_Devon

wotsthat wrote: »

It just seems, on balance, that SMI is a benefit that might just prevent a larger benefits bill later. .

You keep on saying this, no matter how many times or how much data is put infront of you suggesting this is utter nonsense. Even the government themselves refer to those on SMI as "taking a decision to downsize" instead of receiving SMI if the government put a claim on the house.

RUN_RABBIT_RUN

Graham_Devon wrote: »

I reckon if taxpayer money was funding say cars for DLA recipients, that they then got to KEEP (rather than just make use of) and do as they wish with at the end of the 3 years, you would (quite rightly) find that unfair.

I am assuming, the issue with SMI is that it goes into housing, something you are invested in, and therefore don't believe it's unfair, and like to compare it against housing benefit to make this point.

That's fair enough. I'm never going to win the argument. It's bizzare that I can gain support from the same users apposing my thoughts on this thread if I simply talk about benefits themselves. However, if I talk about cutting housing benfit, or SMI, I can't gather the same support.

At the end of the day, if you are invested, or want prices to rise, why on earth would you want anything done to taxpayer money being channeled into the market? You wouldn't. But I can guarantee that if a public sector worker got to keep their pension and still be able to use it (pay into it), even though they no longer were able to work for the public sector, you would be up in arms.

At the end of the day, I see the need for SMI and support for 18m. I don't see how it is just, or fair to simply be paying peoples mortgages off.

i'll give you a thanks for this one because (rather unbelievably) i actually think what you're saying is fair enough in this one isolated case :eek: , not that i particularly agree with it tho

but you're even partially correct about smi paying people's mortgages off, because some people are on a mortgage rate lower than the 3.63 that smi pays off. so i believe some people will see an added benefit

hmmmm maybe i'm being a touch too magnanimous!

Graham_Devon

RUN_RABBIT_RUN wrote: »

i'll give you a thanks for this one because (rather unbelievably) i actually think what you're saying is fair enough in this one isolated case :eek: , not that i particularly agree with it tho

but you're even partially correct about smi paying people's mortgages off, because some people are on a mortgage rate lower than the 3.63 that smi pays off. so i believe some people will see an added benefit

hmmmm maybe i'm being a touch too magnanimous!

47% of those on SMI are having not only the interest paid off, but the interest rate paid is higher than the interest rate on the mortgage. Therefore they get capital paid off too.

It's said to be cheaper to do it this way, rather than the banks claiming for each mortgage.

53% of claimants are having their interest covered fully, or partially. Can't find figures for those that don't have it paid off in full. It seems split into those who are getting capital paid, and those who break even / fall short. However, 75% of all SMI claimants have over 80% of their interest paid off each month. So it's certainly not bad.

In one case which was highlighted, the recipient is getting £340 of capital paid off per month via the taxpayer. Must be a tracker rate, as all SMI does is take the outstanding loan amount any pays 3.64% interest. If the loan rate is a base rate +0.5% tracker, the recipient is quids in and thir mortgage statement must be a delight to read.

What the government want to do (though there is opposition, from the CML and others) is to claw that money back, including payments of capital, with interest to provide a "just and fair" solution for taxpayer money.

I honestly don't think anyone can argue that paying your income tax each month to have money paid off someone elses mortgage capital is something they support. Especially when you consider there are some getting 300 quid paid off each month....

RenovationMan

It's odd that housing benefit is based on the actual rental the claimant pays (upto a cap) and SMI isn't because it's apparently cheaper to administer that way. Why is one treated differently to the other?

Graham_Devon

RenovationMan wrote: »

It's odd that housing benefit is based on the actual rental the claimant pays (upto a cap) and SMI isn't because it's apparently cheaper to administer that way. Why is one treated differently to the other?

Presumably because as with lots of things, it's the banks that are the beneficiarys (in more ways than one with this one) and the changes were a quick response to (in the governments own words) stop reposessions and arrears increasing.

It's done that, but as a consequence, 47% of people get their capital paid off for them. Could be pennies, could be hundreds of pounds. But I'm sure as someone who is actively trying to do such with your mortgage, watching your tax money being fed into reducing someone elses mortgage is now hitting home?

The only positive thing I have to say about the scheme is that it at least halved the interest rate it was paying. Before that, it was paying over 6%, and figures suggest 78% were getting capital paid off up to 2011.

RenovationMan

Graham_Devon wrote: »

But I'm sure as someone who is actively trying to do such with your mortgage, watching your tax money being fed into reducing someone elses mortgage is now hitting home?

I can't say it keeps me up at night. However, as someone who pays the higher rate of tax, I'm happy for all forms of benefits to be capped/reined in but only at the expense of the loafers and not at the expense of genuine cases.

Graham_Devon

RenovationMan wrote: »

I can't say it keeps me up at night. However, as someone who pays the higher rate of tax, I'm happy for all forms of benefits to be capped/reined in but only at the expense of the loafers and not at the expense of genuine cases.

I'm thankful that you reminded us you are a hgh rate taxpayer, again. I wouldn't have been able to take you seriously if you had just suggested you are a taxpayer.

Tricky one you are reno. Reading between the lines, you can see you want to suggest SMI is over generous and something should be done....you just can't quite bring yourself to say it!

RenovationMan

Graham_Devon wrote: »

I'm thankful that you reminded us you are a hgh rate taxpayer, again. I wouldn't have been able to take you seriously if you had just suggested you are a taxpayer.

Tricky one you are reno. Reading between the lines, you can see you want to suggest SMI is over generous and something should be done....you just can't quite bring yourself to say it!

You mentioned me paying taxes, I mentioned that I actually pay a larger amount of tax than many do and so of course I want to reduce that burden, but not at the expense of people who really need it. You and the others really need to get that chip off your shoulders. People earn more than you, people earn less than you, that's just how it is.

I've already said that I don't understand why SMI isn't like housing benefit and set at individual levels. Most people would understand that I'm saying I don't think it's a fair benefit without me having to spell it out (like I just have)

Graham_Devon

RenovationMan wrote: »

You mentioned me paying taxes, I mentioned that I actually pay a larger amount of tax than many do and so of course I want to reduce that burden, but not at the expense of people who really need it. You and the others really need to get that chip off your shoulders. People earn more than you, people earn less than you, that's just how it is.

I've already said that I don't understand why SMI isn't like housing benefit and set at individual levels. Most people would understand that I'm saying I don't think it's a fair benefit without me having to spell it out (like I just have)

OK, you must have changed your mind then, as your previous posts on this subject don't appear to back up the view that you don't feel it's a fair benefit.

Rather, you were just suggesting people wanted others chucked out of their houses.

Now, it seems, after that amazingly original line, it appears you agree with us.

StevieJ

Graham_Devon wrote: »

It's done that, but as a consequence, 47% of people get their capital paid off for them.

So 53% see their debts increase, now that isn't fair