The Support for Mortgage Interest loan scheme (SMI) has been extended to include more Universal Credit claimants, the government has announced in a recent press release. The scheme was set up to help people who are out of work or claiming a pension to receive help to meet the interest on their monthly mortgage payments.
The scheme has been extended to include an additional 200,000 people who are claiming Universal Credit. Initially, people had to have been claiming UC for nine months before they were eligible, but the scheme will now be open to applicants after three months and will be automatically offered to people by the Department for Work and Pensions.
A SMI can be set up without a credit reference check, and it should not affect a claimant’s credit rating. It’s a flexible loan that doesn’t have to be repaid in regular instalments, unless the borrower chooses to do so. Interest rates are usually lower than for most other types of loan.
Mims Davies, Minister for Social Mobility, Youth and Progression, said: “The fear of losing your home when you have fallen on difficult times is incredibly stressful and makes getting back on your feet all the more difficult.”
She added: “This increased support is an important lifeline to help provide stability for those who are seeking to find work and move back towards long-term prosperity.”
The loan can also be used to fund certain home repairs or improvements up to the value of £200,000. The loan will be repaid when the borrower sells their home, and it can also be transferred to a new property if necessary.
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Your home may be repossessed if you do not keep up with your mortgage repayments.
There may be a fee for mortgage advice. The actual amount you pay will depend on your circumstances. The fee is up to 1% but a typical fee is £595.
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Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it. There may be a fee for mortgage advice. The actual amount you pay will depend on your circumstances. The fee is up to 1% but a typical fee is £595.
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