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Chancellor's Autumn Statement 2022: Mortgage support expanded to help those struggling with payments

More homeowners who are struggling with mortgage repayments will be eligible for state support from next year, the Government has announced. From spring 2023, access to the 'support for mortgage interest' scheme will be expanded – meaning you might be able to get help covering the interest element of your mortgage repayments if you're struggling.

The change was announced by the Chancellor Jeremy Hunt today (17 November) as part of the Government's Autumn Statement – see a full-round up of other announcements in our Autumn Budget 2022 round-up.

Support for mortgage interest – SMI – is a scheme that mainly helps benefit-claiming homeowners who are struggling with mortgage payments to cover the interest due. You'll only normally qualify for SMI if you've been claiming benefits for around nine months, but Mr Hunt revealed that this wait time is going to be cut to three months from spring 2023, meaning some people will be able to claim support sooner.

Below we explain in more detail what's changing. You can also watch founder Martin Lewis's video below.

Martin Lewis analyses the Autumn Statement's impact on mortgages
Embedded YouTube Video

How 'support for mortgage interest' works – and what's changing

SMI is a state support scheme that helps some homeowners cover the interest on their mortgage if they're struggling with repayments. 

We've got full details about how SMI works in our Mortgage arrears guide, but in brief:

  • SMI can help with the interest on the first £200,000 of your mortgage balance. This is capped at £100,000 if you're receiving pension credit.

  • SMI won't necessarily cover all of the interest you need to pay. That's because the Government doesn't use your specific interest rate to work out how much help you're eligible for.

  • SMI is paid as a loan – meaning whatever you borrow you'll need to repay. Plus you'll be charged interest on your SMI loan in the meantime. SMI is paid directly to your lender. You don't need to repay the loan until you sell your property.

To qualify for SMI, you usually need to be earning one of a number of qualifying benefits, such as universal credit, pension credit, income support, income-based jobseeker's allowance and income-related employment support allowance.

Where you receive universal credit (UC), you'll need to have been claiming this for a minimum of nine consecutive months before you're allowed to apply for SMI. For income support, JSA and ESA it's 39 weeks, and for pension credit, you can claim it from the date you start getting pension credit.

Yet there's another barrier on top of the wait time - currently if you earn any income from a job, you're automatically disqualified from SMI.

But Mr Hunt has announced that, from spring 2023, this nine-month wait will be reduced to three months. In addition, the zero-earnings rule will also be scrapped, meaning you will be able to be on UC and earning income from a job and still be eligible for SMI.

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