Help to pay your mortgage
What is a Support for Mortgage Interest loan?
If you are receiving certain benefits and have a mortgage you may be able to get a loan from the government to help pay it.
The loan is called Support for Mortgage Interest (SMI). It used to be paid as part of a benefit but changed in April 2018 to a loan which needs to be paid back. If you receive SMI benefit before the change you will be told by letter and be offered the new SMI loan.
Who can get the loan?
To qualify you need to be in receipt of, or applying for, income support, income-based jobseeker’s allowance, income-related employment and support allowance, universal credit and not working or pension credit.
You do not have to take the loan and may want to seek professional help to discuss other payment or housing options.
How much can I get and how is it paid?
The loan will not be paid for the first 39 weeks after you claim. After this waiting period your monthly mortgage payments will be paid directly to your mortgage provider until you stop getting the qualifying benefit, start work or decide you no longer want the loan. The largest loan you can get is to cover interest on a mortgage of up to £200,000.
How and when do I repay the loan?
The loan needs to be repaid once you sell your house but you can pay it off before then if you can afford to, for example if you start work. If you die before the loan is paid your heirs will need to pay the loan once the house is sold.
If there is not enough money to pay the loan once the house is sold, and the mortgage paid off, the debt will be written off and the loan considered paid in full. You will also have to pay back any interest on the loan which, at the moment, is 2.61%.
How do I apply for the loan?
If you are applying for one of the qualifying benefits for the first time you will be asked at the time if you want the loan. If you were receiving SMI benefit you will be asked when you are told that the benefit is being replaced by the loan. If you already get one of the qualifying benefits you can contact Jobcentre Plus to apply.
After you apply you will be contacted by telephone to discuss the terms and conditions of the loan but there will not be a credit check and your credit score will not be affected.
See Gov.uk for more details on Support for Mortgage Interest loans, or call the Lone Parent Helpline on 0808 801 0323 if you need more advice.