Support for Mortgage Interest
Support for Mortgage Interest (SMI) is a welfare benefit in the United Kingdom that entitles a person to help with their mortgage costs. The SMI is paid as a loan, which the person will need to repay with interest when he or she dies, sells or transfers ownership of their home. Before this date, SMI is paid as a benefit, which the beneficiary does not have to repay. It is usually needed to be getting, or treated as getting, a qualifying benefit to get SMI. There’s no guarantee that a person will get SMI for  a mortgage or loan he or she takes out. To get SMI a person must be in receipt of one of the following benefits: Those in receipt of Universal Credit may also be entitled to SMI. The waiting time for help increased on 1 April 2016 from 13 weeks to 39 weeks. The cost of the benefit was £205 million in 2017. With SMI ending in April 2018, saving the government about £170 million a year, the Department of Work and Pensions is offering a loan, secured on the recipient's property, a move criticised because it would  put properties of people on low incomes at risk; the cessation affects about 124,000 people. Key Facts. SMI cannot help to pay: Support for mortgage interest can be also used to cover some other costs, but only under the conditions that: Process. If the conditions for getting the loan were fulfilled, then the payment is not made right away it takes 39 weeks from the time when the Support for Mortgage Interests was claimed. There is only one exception, when the person is getting Pension Credit, in this particular case help is provided immediately. The waiting period is interrupted  in the case when a person gets any paid job. Amount of Money. The government can pay the interest up to £200,000 of the mortgage (but if the person is on the Pension Credit then up to £100,000). A standard interest rate is used by the government to calculate the amount of the money by which it will help, that means that the government´s interest rate might differ from the interest rate on the mortgage. The payments will always be made to mortgage lenders directly. The SMI only covers the interest rate of the mortgage, not the actual  amount that was borrowed. Time Limits. There are certain conditions that can help to find out for how long person can get the SMI: Repayments. Various cases may occur when a person considers repaying an SMI loan. Here are some life examples to evaluate the situation properly: