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Smi Ending For Some?

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How many will be losing their support ?

http://www.direct.gov.uk/en/MoneyTaxAndBenefits/BenefitsTaxCreditsAndOtherSupport/On_a_low_income/DG_180321

Two year time limit to SMI

A two year time limit to SMI for new customers getting income-based Jobseeker's Allowance was introduced from 5 January 2009.

This will start affecting some people from 5 January 2011. If you have received SMI for two years from 5 January 2009 or later, you will no longer receive help with your mortgage interest. This will apply if you have been getting SMI continually or through linked benefit claims.

It is important that you talk to your lender about this change. Lenders are required to treat people fairly, and must consider what they can do to prevent borrowers losing their homes.

If you can't meet your mortgage repayments, or you are worried you might fall behind, you must contact your lender as soon as possible. You can also get independent advice from other organisations. Further information about mortgage arrears or payment difficulties can be found using the following link.

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Hopefully the government will come up with a new way to keep unemployed members of the homeowner caste in houses they can't afford. Wouldn't want them to have to become, ugh, renters.

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Yes, this is the "elephant in the room", all of a sudden many people are going to be paying nothing to their lenders. Next stop repossession.

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once these repoes hit the marekt hit it'll eb game over.

waiting to see which of the banks will break ranks first.

This was dicussed last year. I think the question was, are there going to be enough SMI claimants to have a big impact on repo numbers? Let's hope so.

I'll be keep an eye out for extra repos in a few months time.

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Of course, if you're one of the 38% of SMI claimants over 65 in receipt of pension credits your mortgage interest will continue to be paid until you die. Surely the mortgage must be paid off by the time you're 65 I hear you cry?. Well SMI will be paid out for MEW if it was for home improvements, so basically free conservatories, extensions, double glazing, kitchen and bathrooms.

I raised this and other SMI related issues with Lord Freud, I'll have to dig out and post his reply.

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Of course, if you're one of the 38% of SMI claimants over 65 in receipt of pension credits your mortgage interest will continue to be paid until you die. Surely the mortgage must be paid off by the time you're 65 I hear you cry?. Well SMI will be paid out for MEW if it was for home improvements, so basically free conservatories, extensions, double glazing, kitchen and bathrooms.

I raised this and other SMI related issues with Lord Freud, I'll have to dig out and post his reply.

Please do. Although I'm sure the reply was utter rubbish.

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I guess alot of these situations will fly under the radar because the borrowers will likely give up possession voluntarily, without repo proceedings. The lender can also appoint a receiver and sell with borrowers still resident.

Mind you, looks like that will change later in the year with legislation to prevent lenders taking possession and selling without a court order. Might be interesting then to see just how many houses are involved in this crisis, beyond the number of court orders published by the CML.

As for lenders selling repos - does anyone have sources on what they're actually doing? Consensus on this forum was that they must be hoarding empty properties in SIVs, but I haven't read any comments on this for ages.

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Of course, if you're one of the 38% of SMI claimants over 65 in receipt of pension credits your mortgage interest will continue to be paid until you die. Surely the mortgage must be paid off by the time you're 65 I hear you cry?. Well SMI will be paid out for MEW if it was for home improvements, so basically free conservatories, extensions, double glazing, kitchen and bathrooms.

I raised this and other SMI related issues with Lord Freud, I'll have to dig out and post his reply.

I think the 38% was Income Support/Incapacity Benefit (as it was) and 53% were Pension Credit with only 12% of SMI claimants being on the time limited SMI because they were claiming Jobseekers Allowance.

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Hopefully the government will come up with a new way to keep unemployed members of the homeowner caste in houses they can't afford. Wouldn't want them to have to become, ugh, renters.

They have just extended the existing scheme until the "housing market recovery is secured"...

'Spending Review 2010 - Welfare reform':

http://nds.coi.gov.uk/content/detail.aspx?NewsAreaId=2&ReleaseID=416108&SubjectId=2

Extending for a further year the temporary measures to reduce the waiting period for new working age claimants to 13 weeks and increase in the limit on eligible mortgage capital to £200,000. These were due to expire in January 2010.

This offers continued support to homeowners until the housing market recovery is secured. 85,000 claimants will benefit from the waiting period remaining at 13 weeks, and about 14,000 will benefit from the increased capital limit.

Cost: £90 million over the next two years.

Edited by CrashConnoisseur

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They have just extended the existing scheme until the "housing market recovery is secured"...

'Spending Review 2010 - Welfare reform':

http://nds.coi.gov.uk/content/detail.aspx?NewsAreaId=2&ReleaseID=416108&SubjectId=2

But that hasn't changed the 2-year limit, right?

According to this doc:

http://www.dwp.gov.uk/docs/support-for-mortgage-interest.pdf

"At November 2009, there were 225,000 customers receiving Support for Mortgage Interest"

Page 8 shows that the vast majority of people on SMI are pensioners. Seems like an ace way to game the system. Only 15% on JSA. Impact will be minimal.

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Page 8 shows that the vast majority of people on SMI are pensioners. Seems like an ace way to game the system. Only 15% on JSA. Impact will be minimal.

there ARE on pretty low mortgage balances AFAIK, doesn't make it much fairer, but less expensive

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But that hasn't changed the 2-year limit, right?

According to this doc:

http://www.dwp.gov.uk/docs/support-for-mortgage-interest.pdf

"At November 2009, there were 225,000 customers receiving Support for Mortgage Interest"

Page 8 shows that the vast majority of people on SMI are pensioners. Seems like an ace way to game the system. Only 15% on JSA. Impact will be minimal.

So 33,750 are in JSA. I wonder how many claimed after January 5th 2009. Looks like it probably won't have a big impact.

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