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SMI loan concerns and action

AlliAlli Member Posts: 1 Listener
Hello. I’m new to this and would like to know if people are aware of the impact of SMI loan from April 2018. I am currently taking it to parliament and in conversation with MP Secretary of State. As there are 2 BIG concerns I see. Maybe more! As no one really knows what the rules are when you call SMI. 
If they are paying your interest on your mortgage they are getting you into seriouse debt. As the monthly interest you will need to pay back on the interest of the loan. ( yes, interest loan to pay interest is not permitted by banks). They say you don’t need to pay any back, until you sell your property or die. Well if you make no payments like they say and leave it. Every month you are charged interest on the entire lot. So could have no equity left to leave family. In fact they will own the property. Only way I see a solution is to see if you can pay monthly the interest they are charging you on the loan! You still have to pay the original loan interest too. So I worked out if I can pay my own I am £40,000 better off and still own my home. 
If over 55 and have equity in property you will be better doing this.  
I am having to sell my home now as I cannot afford the interest on my mortgage and the SMI loan will put me into serious debt and eventually own 100% of my home if no payment made. Until end of mortgage. As after mortgage ends the SMI loan will be charging interest every month. 
I shall update you on what Parliament say. 

Replies

  • thespicemanthespiceman Member Posts: 6,408 Disability Gamechanger
    Hello @Alli Pleased to meet you.

    Thanks for sharing your story.  I am sure the community will be supportive.  Be interested in your petition.

    We are a friendly community. Care and share.

    Ask the community anything.

    Hope and wish you the best in your endeavours.

    Take care

    @thespiceman
    Community Champion
    SCOPE Volunteer Award Engaging Communities 2019
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  • Chloe_ScopeChloe_Scope Scope Posts: 10,653 Disability Gamechanger
    Hi @Alli and a warm welcome to the community! Thank you for sharing your story. Unfortunately I do not know the answer to your question, but I hope someone in the community will do! Please do have a look around the community and feel free to get involved in any aspect that you like!
    Scope

  • dyannehollanddyanneholland Member Posts: 2 Listener
    Alli said:
    Hello. I’m new to this and would like to know if people are aware of the impact of SMI loan from April 2018. I am currently taking it to parliament and in conversation with MP Secretary of State. As there are 2 BIG concerns I see. Maybe more! As no one really knows what the rules are when you call SMI. 
    If they are paying your interest on your mortgage they are getting you into seriouse debt. As the monthly interest you will need to pay back on the interest of the loan. ( yes, interest loan to pay interest is not permitted by banks). They say you don’t need to pay any back, until you sell your property or die. Well if you make no payments like they say and leave it. Every month you are charged interest on the entire lot. So could have no equity left to leave family. In fact they will own the property. Only way I see a solution is to see if you can pay monthly the interest they are charging you on the loan! You still have to pay the original loan interest too. So I worked out if I can pay my own I am £40,000 better off and still own my home. 
    If over 55 and have equity in property you will be better doing this.  
    I am having to sell my home now as I cannot afford the interest on my mortgage and the SMI loan will put me into serious debt and eventually own 100% of my home if no payment made. Until end of mortgage. As after mortgage ends the SMI loan will be charging interest every month. 
    I shall update you on what Parliament say. 
    In the same position!! Please keep me updated. After 40 years of struggling now on the verge of being repossessed.. 
  • Pippa_AlumniPippa_Alumni Scope alumni Posts: 5,851 Disability Gamechanger
    Hi @alli, and welcome!

    Hopefully our community will be able to help, but you may like to check out the SMI information on Scope's website in the meantime:

    Where can I get advice about my personal situation?

    A company called Serco is acting on behalf of DWP to tell people who receive SMI about these changes. Serco cannot give you advice, but they can provide information about the changes.
    The Money Advice Service website has information about getting free financial help and information
     
    If you need help finding advice, please get in touch with Scope helpline.
    We’re not qualified to provide financial advice but we can talk through other issues and help you explore your options.
     
    See the discussions on our online community for examples of what others going through these changes are doing to prepare and find information. 
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