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On universal credit and struggling to pay your mortgage? Check if you can get help with the interest as Government scheme is expanded

An extra 200,000 homeowners on universal credit are now eligible for state help with their mortgage repayments as changes to the 'support for mortgage interest' scheme have kicked in today (3 April). It means you might be able to get help covering a portion of your monthly mortgage repayments if you're struggling. 

Support for mortgage interest (SMI) is a scheme that mainly helps benefit-claiming homeowners who are struggling with mortgage payments to cover the interest element of their home loans. 

Changes to the scheme – which aimed to increase the number of homeowners able to access it – were announced last November as part of the Government's Autumn Statement. At the time, no firm date was set for when the changes would kick in, but the Government has confirmed these are now effective.

More people on universal credit are now eligible to claim SMI 

Until today, if you were receiving universal credit you needed to have done so for nine consecutive months before you could claim SMI. This wait has now been cut to three consecutive months – meaning if you've already been receiving universal credit for 90 days (as of today, 3 April) you can now claim SMI and you don't have to wait another six months before you can apply.

Prior to today's changes, universal credit claimants were also unable to claim SMI if they received income from a job – in other words, they had to be unemployed. But from 3 April, this 'no earnings' rule has been scrapped for universal credit claimants and there is now no cap on how much income you can earn from a job if you want to get SMI.

These changes only apply to universal credit claimants; not to those on older legacy benefits. 

How 'support for mortgage interest' works

SMI can help some homeowners cover the interest on their mortgage repayments if they're struggling. We've got full details about how SMI works in our Mortgage arrears guide, but in brief:

  • SMI can help with the interest on up to 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. It instead sets its own rate, which is currently 2.09%. 

  • SMI is paid as a loan – meaning whatever you borrow you'll need to repay. You'll also 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 or income-related employment support allowance.

I'm now eligible for SMI. How do I make a claim?

The Department for Work and Pensions (DWP) told that it'll begin reaching out to newly eligible claimants from today. Those on universal credit will receive a message through their online 'journal' – this is the section of your online account where you can keep in touch with your work coach or case manager. 

If you believe you're eligible but don't want to wait to be contacted, the DWP says you can get in touch with it directly. If you're on universal credit, the best way to do this is by leaving your case manager or work coach a journal message

Separately, the Government will also contact some on legacy benefits by letter to remind them that they may be eligible for SMI (including those who've turned it down previously). If you're unsure, or you don't want to wait to hear from DWP, you can contact the Jobcentre Plus or Pension Service depending on which qualifying benefits you claim. See for more info. 

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