Support for Mortgage Interest changes agreed by Minister
We are delighted that the Department for Work & Pensions has announced that people who use Support for Mortgage Interest (SMI) to buy their shared ownership property will now be able to transfer this support to their new property when moving home. This is of particular interest to our HOLD customers because if they need to sell their current property due to changes in their health needs or they want to move closer to support networks, they will not have to immediately pay back the loan portion (SMI) of their mortgage.
When the Government announced changes to the SMI programme in April 2018 it turned what was once a benefit into a loan. Quite a number of our HOLD customers have used SMI to pay for their mortgage through the HOLD scheme. Although we accepted that this loan would need to be paid back eventually our assertion was that some of our customers may need to move in future and if they had to pay off their SMI loan when moving it would erode or erase any equity built up in the property. This could leave them without enough funds to move to a different home to suit their changing needs.
We have worked with our customers and their families and alongside Mencap and MySafeHome over the last 18 months to lobby Ministers about this issue and we are delighted they have taken our comments on board and have made this important adjustment to the SMI loan programme.
We understand the ruling came into effect on 12 June and you can read the full announcement here. https://www.gov.uk/government/news/minister-announces-new-transfer-option-for-mortgage-interest-support