Changes to support for mortgage interest
We are one of the few remaining specialist housing providers of the shared ownership scheme for people with disabilities and mental health conditions (HOLD). Under the scheme, customers who qualify get to choose their own property on the open market and Advance purchases it on their behalf.
Support for mortgage interest (SMI) is used by many of our shared owners to meet the interest charged on their mortgage. However, the Government is altering the way that they will pay SMI from the 6th April 2018. It will still be available for claimants who meet the criteria but it will become a loan with interest for any payments made by the Department for Work and Pensions (DWP).
We are concerned that as this loan, and the requirement to pay it back following any sale of the property will mean any customer who has to move house, if their personal or health circumstances change, would have a smaller amount of equity to fund any new purchase. Therefore we have been pressing the DWP to ask if the SMI could stay with the person until they no longer need it or could move it with them to a new property without having to pay back the loan.
Our customers who currently claim Support for Mortgage interest should have received information from the DWP/SERCO about the change explaining what needs to happen to convert the current benefit to a loan. It is important to take action so that mortgage payments continue but we are hearing anecdotally that some people have not been notified and the deadline is rapidly approaching.
SERCO can be contacted on 0800 046 8333. The DWP have said they will give customers who need support to act on the changes extra time to do so – but SERCO need to be contacted in order for that to happen.
Overall we believe our shared ownership product continues to be a great scheme for those who wish to live independently in an area of their choice and have many positive outcomes to support this. We will continue to support our customers who want to consider this as a long-term housing option for them or their loved ones.
To learn more about how our shared ownership product works: https://www.advanceuk.org/shared-ownership
DWP transitional protection