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Support for mortgage interest
Daphne, the interest rate for the loan is in 15. while the standard rate for the mortgage is in 13.
And I thought Paul was referring to the standard interest rate ie reg 13 but I could very easily be wrong - Paul??
I think Paul was saying that the DWP pay the mortgage company 2.61% and then charge the claimant 2.2% compounded.
My mistake - I’ll get my coat…
PS Aren’t you in Italy - what are you doing on rightsnet - not that it isn’t very helpful ;)
I think Paul was saying that the DWP pay the mortgage company 2.61% and then charge the claimant 2.2% compounded.
Yes I was which seemed od to say the least.
Aren’t you in Italy - what are you doing on rightsnet
. I’m sittin in a notaries office while they redo 15 pages of text because they missed out my surname.
DWP has told us:
The 2.2% interest rate being mentioned seems to have come from some confusion between the standard interest rate (currently 2.61%) and the rate charged on SMI loans (forecast to be 1.7% in 2018/19). We are in the process of correcting this in the script.
The 2.2% interest rate being mentioned seems to have come from some confusion between the standard interest rate (currently 2.61%) and the rate charged on SMI loans
Cobblers, They just used the wrong year; why do they have to create an excuse that doesn’t stand-up to examination?
Terrifyingly ill-informed response from government minister Sajid Javid on SMI changes…
John Healey (Wentworth and Dearne) (Lab)
Some 3.5 million families with a variable rate mortgage face higher costs if the Bank of England puts up interest rates this week, so why are the Government, at this of all times, scrapping support for mortgage interest payments?
Sajid Javid
This Government have made it clear that it is our ambition to have more people own their own homes. There are a number of areas of intervention; one of the most prominent is the Help to Buy scheme, which is helping hundreds of thousands of people, who otherwise might not have been able to buy a home, to get on the housing ladder for the first time. Ultimately, if the right hon. Gentleman, like me, wants to help more people own their own home, he should support this Government with our housing White Paper and the other measures we take.
John Healey
The Secretary of State is flannelling. Home ownership is at a 30-year low, and he does not seem to appreciate that 126,000 households, including 60,000 pensioner households, get help from the current scheme. From April, they and anyone else struggling with their mortgage costs will be offered a loan, but a loan is no good for those already struggling with the cost of the loans they have. Under Labour, with our mortgage rescue scheme, help was there when it was needed for families facing repossession. [Interruption.] The hon. Member for Torbay (Kevin Foster) is laughing; I ask this of the Secretary of State, who takes the subject more seriously: will he use the Budget to scrap the Government’s current changes and back instead a new home ownership guarantee scheme, as Labour proposed at the election?
Sajid Javid
The right hon. Gentleman talks about what happened on housing under Labour, so let me remind him: when he was the housing Minister, house building fell to almost its lowest level for almost 100 years, and the number of social units available for rent declined by 410,000. So we will not be taking any lectures from the right hon. Gentleman.
just had first letter in from dwp asking client to provide a phone number so that SERCO can contact nim to arrange a loan for SMI, if he does not provide a phone number his SMI will stop, client is age 81 and terrified he may lo e his home, also what if he doe snot have a phone or does want t to disclose it, SERCO ,!!! is this another saga like HMRC and the company they employed that was fired in by the Govt
Just in via DWP Operational Stakeholders….
Support for mortgage interest (SMI) loans
There has been some confusion about the interest rate that will be used to calculate SMI when SMI loans are introduced in April 2018.
This note confirms that claimants’ SMI loans will be calculated in the same way as current SMI benefit provision, by using the standard interest rate (which is currently 2.61%). SMI loans will NOT be calculated by using claimants’ contractual mortgage interest rates.
Caroline Dinenage confirmed yesterday in a written answer the current gilt rate of 1.5 per cent will be charged on DWP loans for SMI -
Interest will be charged on SMI loans based upon the cost of gilts as published by the Office for Budget Responsibility (OBR). This rate reflects the cost of Government borrowing. The Gilt Rate Forecast for 2018-19 is 1.5 per cent, as specified in the latest Economic and Fiscal Outlook published on the 22nd November 2017 by the OBR.’
Media apparently waking up to what’s coming now.
Mortgage safety net ‘disappearing’ - BBC News
Low-income households at risk as mortgage support benefit is axed - The Guardian
DWP estimates a fall in those affected by loans for SMI from April 2018 to 110,000 - down from its 124,000 estimate in the impact assessment of July 2017 - 49,000 on ESA….
An earlier written answer from November, provides a further breakdown - that 38,000 affected ESA claimants will be in the support group….
We’re seeing an increase in queries from very worried disabled people, families and carers of disabled children about the SMI changes.
I’ve spoken to several disabled people who have contacted us about the SMI changes. Some had no knowledge of Universal Credit at all. That worries me because they’ve to got to make a very big decision about their future financial security. Now they have to factor in UC and the implications of early migration and risks of further reductions to an income already stretched. Then there’s all the other complex problems with PIP and WCAs and everything else really- housing, social care etc.
There’s such a lack of advice for people affected by these changes.
What can we do to challenge this and stop or slow down this final safety net being removed?