Mortgage support has been expanded to help Brits who are struggling to keep up with their payments.
The support relates to the Support for Mortgage Interest (SMI) scheme.
The change was announced as part of Chancellor Jeremy Hunt ’s Autumn statement yesterday - and it means mortgage owners may receive help to cover their interest.
MoneySavingExpert founder Martin Lewis took to his website to explain what the change means for homeowners.
In a short clip, he said: “On mortgages, there is a change to the Support for Mortgage Interest payments - that is support for people who have lost their jobs, and helps pay the interest on their mortgages.
“Currently you can only get that if you’ve been out of work for nine months. That will be changing so you can get it if you’ve been out of work for three months.
“Also, there’s a rule that says if you have any earnings at all, you can’t get it. That rule is being scrapped - and it’ll be on an individual assessment basis.”
The money guru also explained some new changes to rent prices for those in social housing.
He said: “There is also, for those who are in social housing, which tends to mean Housing Association or local council housing, then there’s already a cap on the amount your rent can go up.
“It was capped at inflation plus 1%, that would be an 11% rise.
“That’s been reduced, so the maximum rise is now capped at 7%. So your rent can go up, but it can’t go up quite as much as it could have done before.”
Martin says he met with Jeremy Hunt to share his thoughts on energy and mortgages.
He said: “I pushed hard that we need more flexibility and forbearance in the system for mortgages for when it comes to Spring and interest rates are at their peak.
“That doesn’t just help those on mortgages, it also helps people on rent because the people who are charging them mortgages, charging them rent, have buy to let properties.
“So he is on the back of that, going to call a summit with the big banks.
“I will be there, and various others will try to discuss what flexibility and forbearance measures can be put in place before next spring to try and help people.”
Access to the 'support for mortgage interest' scheme will be expanded from spring 2023, the Government has said.
How the 'support for mortgage interest' scheme works
SMI helps some struggling homeowners cover interest on the first £200,000 of their mortgage balance.
This is capped at £100,000 if you're claiming Pension Credit.
It is paid as a loan, which means anything borrowed will need to be repaid - and the SMI loan will itself charge interest.
You won’t need to repay the loan until you sell your property.
To qualify, you would typically need to be receiving the following qualifying benefits:
- Universal Credit
- Pension Credit
- Income Support
- Income-based Jobseeker's Allowance
- Income-related Employment Support Allowance
