SMI rate

franklin.adele

My debt adviser and myself rang back in July with similar answers of they dont know! Ive had a letter today from mortgage company of the new payment amount,these now seem to come every 2 months keeps going up and up,now ive had a letter from smi saying they will be paying less towards the interest?!? How do they work this out,im having to find £200 out of my !!!!!! it seems as im classed as vulnerable and on sickness benefits,this isnt even a benefit i will be paying it back but its not of much help and actually put me in arrears as i assumed it went up with the interest rates as when they went down it certainly followed suit them,no one seems to be mentioning this all focus is on energy bills i cant find anything on here except stuff about energy bills,if i manage to keep a roof over our heads and feed us heat wont be an option or i could pay for heat and have no home to keep warm,im at a loss i really am

silvercar

franklin.adele said:

My debt adviser and myself rang back in July with similar answers of they dont know! Ive had a letter today from mortgage company of the new payment amount,these now seem to come every 2 months keeps going up and up,now ive had a letter from smi saying they will be paying less towards the interest?!? How do they work this out,im having to find £200 out of my !!!!!! it seems as im classed as vulnerable and on sickness benefits,this isnt even a benefit i will be paying it back but its not of much help and actually put me in arrears as i assumed it went up with the interest rates as when they went down it certainly followed suit them,no one seems to be mentioning this all focus is on energy bills i cant find anything on here except stuff about energy bills,if i manage to keep a roof over our heads and feed us heat wont be an option or i could pay for heat and have no home to keep warm,im at a loss i really am

The government’s position on SMI seems to be that it is a way of offering help in the  short term to those who are in financial difficulty, rather than a long term help for people with a mortgage to pay. In contrast to the housing element of universal credit or housing benefit/ LHA, which is designed to keep people in their (affordable) homes. 

In reality, housing benefit is possible but unlikely to cover the full rent cost and SMI doesn’t cover all the mortgage payment. The latter made worse by the fact it is a loan.

housebuyer143

silvercar said:

franklin.adele said:

My debt adviser and myself rang back in July with similar answers of they dont know! Ive had a letter today from mortgage company of the new payment amount,these now seem to come every 2 months keeps going up and up,now ive had a letter from smi saying they will be paying less towards the interest?!? How do they work this out,im having to find £200 out of my !!!!!! it seems as im classed as vulnerable and on sickness benefits,this isnt even a benefit i will be paying it back but its not of much help and actually put me in arrears as i assumed it went up with the interest rates as when they went down it certainly followed suit them,no one seems to be mentioning this all focus is on energy bills i cant find anything on here except stuff about energy bills,if i manage to keep a roof over our heads and feed us heat wont be an option or i could pay for heat and have no home to keep warm,im at a loss i really am

The government’s position on SMI seems to be that it is a way of offering help in the  short term to those who are in financial difficulty, rather than a long term help for people with a mortgage to pay. In contrast to the housing element of universal credit or housing benefit/ LHA, which is designed to keep people in their (affordable) homes. 

In reality, housing benefit is possible but unlikely to cover the full rent cost and SMI doesn’t cover all the mortgage payment. The latter made worse by the fact it is a loan.

SMI only covers the interest payments, so those on repayment never got the whole amount paid and had to find the shortfall, but now they get only a small amount of the interest paid and must find a vastly larger payment. 

franklin.adele

housebuyer143 said:

silvercar said:

franklin.adele said:

My debt adviser and myself rang back in July with similar answers of they dont know! Ive had a letter today from mortgage company of the new payment amount,these now seem to come every 2 months keeps going up and up,now ive had a letter from smi saying they will be paying less towards the interest?!? How do they work this out,im having to find £200 out of my !!!!!! it seems as im classed as vulnerable and on sickness benefits,this isnt even a benefit i will be paying it back but its not of much help and actually put me in arrears as i assumed it went up with the interest rates as when they went down it certainly followed suit them,no one seems to be mentioning this all focus is on energy bills i cant find anything on here except stuff about energy bills,if i manage to keep a roof over our heads and feed us heat wont be an option or i could pay for heat and have no home to keep warm,im at a loss i really am

The government’s position on SMI seems to be that it is a way of offering help in the  short term to those who are in financial difficulty, rather than a long term help for people with a mortgage to pay. In contrast to the housing element of universal credit or housing benefit/ LHA, which is designed to keep people in their (affordable) homes. 

In reality, housing benefit is possible but unlikely to cover the full rent cost and SMI doesn’t cover all the mortgage payment. The latter made worse by the fact it is a loan.

SMI only covers the interest payments, so those on repayment never got the whole amount paid and had to find the shortfall, but now they get only a small amount of the interest paid and must find a vastly larger payment. 

This is the problem as it doesnt cover the interest,ive been on it for a while as i have a chronic illness it was a benefit and then changed to a loan and has always covered the interest and i have paid the repayment. The interest rates have risen many times this year but the "support" to cover the interest has not leaving me with a shortfall putting me into arrears as it has always previously gone up or down with the base rate so i assumed it would again so i am now struggling to keep up with the extra as the interest goes up on a regular basis along with energy and food. It is meant to help during times of need/crisis which i think this is for a lot of people and it isnt doing so,and its not a benefit its a loan i have to pay back so i would expect if i got a loan from a bank they would cover what i needed so why is this not. The people at DWP themselves dont know why its not gone up inline with everything else the MP we have spoken with does not understand either,all i can find is it needs to be .5% difference between the base rate and their rate which is 2.09% and im sure the rate now is 3.5% so defo more than .5%,maybe there will be an increase soon to follow but as it stands now there is no information no support just left to panic about losing out home. The only info i can find in relation to this crisis is that it will be made availble to more people now but nothing on why the amount is not going up with the interest rates but the repayment of the loans interest rate has gone up twice so they are on the ball there alright.

silvercar

I can see that individually people are losing out, but the methodology was chosen to be simple to administer, rather than say looking at individuals exact payments and changes. 

Now with higher interest it costs more, possibly more people need to claim, so the overall amount is spread more thinly. 

I think the writing was on the wall when they moved it from a benefit to the loan. The government don’t want to be seen to be subsidising home ownership. If that is the conservative government view, I can’t see Labour giving more help.