Finances and extra costs
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Support for mortgage interest

laxylaxy Member Posts: 38 Connected
edited March 28 in Finances and extra costs
Hi has anyone applied for smi loan and is there a catch, will i regret it?

Replies

  • Ross_ScopeRoss_Scope Posts: 4,114

    Scope community team

    Hello @laxy, I hope you are well.

    I haven't applied for it personally, but I always think it's good to canvas the thoughts of others, and do your own research, when considering something like SMI. You can find a page here from the Money Advice Service which contains further information, and hopefully we will have members with experience of applying for it.
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  • woodbinewoodbine Community Co-Production Group Posts: 4,425 Disability Gamechanger
    SMI is now not a benefit as such but a loan that at some point in the future will have to be repaid.

    https://www.moneyadviceservice.org.uk/en/articles/support-for-mortgage-interest
    "Putting a child into care, isn't caring for a child" (T.Rhattigan)
  • MarkIngletonMarkIngleton Member Posts: 30 Connected
    They also charge  interest  on the money they pay out plus money  back  
  • laxylaxy Member Posts: 38 Connected
    So are you saying interest is double when u pay back 
  • woodbinewoodbine Community Co-Production Group Posts: 4,425 Disability Gamechanger
    No you pay interest on the money you borrow for SMI, you also have to wait 39 weeks before you can apply for it.
    "Putting a child into care, isn't caring for a child" (T.Rhattigan)
  • laxylaxy Member Posts: 38 Connected
    @woodbine I am eligible for it. But Im not understanding much. Is there a catch and if I do it temporary for couple of years. Am I paying low interest than banks interest. I know it's a help scheme but obviously nothing is free . Am I better of with bank or is it ok to do smi ??? I thought some one must have taken smi so I can see they reviews
  • woodbinewoodbine Community Co-Production Group Posts: 4,425 Disability Gamechanger
    Since SMI changed from a benefit to a loan scheme many people have done their best to avoid it, as I am not qualified to give financial advice and don't know any of your personal circumstances the only advice i can offer is 1) read the link that leecal provided for you   2) talk to your lender.

    Hope that helps?
    "Putting a child into care, isn't caring for a child" (T.Rhattigan)
  • MarkIngletonMarkIngleton Member Posts: 30 Connected
    As I understand  it they pay the bank interest of your mortgage until you sing off . Them they charge you interest  on the interest they pay  .  Ask your bank if not sure  I found it better not to take  it if you can manage  as I have a long term left on my mortgage. And it is low payment  back to the bank . Ask bank for a fix payment  on mortgage  it could  help . 
  • woodbinewoodbine Community Co-Production Group Posts: 4,425 Disability Gamechanger
    As I said it's impossible to give anyone financial advice unless you know all their circumstances and I wouldn't expect anyone to want to make those public.
    "Putting a child into care, isn't caring for a child" (T.Rhattigan)
  • laxylaxy Member Posts: 38 Connected
    @MarkIngleton
    Thank you for your reply I understood . I going to keep away from it.
  • woodbinewoodbine Community Co-Production Group Posts: 4,425 Disability Gamechanger
    In general if you are struggling to pay your mortgage you can ask the bank to put you on "interest only" this is typically done for 6 months.
    "Putting a child into care, isn't caring for a child" (T.Rhattigan)
  • janer1967janer1967 Member Posts: 11,120 Disability Gamechanger
    Hi 

    I had trouble paying my mortgage and just rang the lender and they sorted out reduced payments even nil payments once my property was put on the market 
  • leeCalleeCal Member Posts: 3,632 Disability Gamechanger
    edited March 28
    When I had trouble paying my mortgage my bank told me if I missed three months they’d start repossession proceedings! I’d never missed a payment. That’s empathy right there! 
  • janer1967janer1967 Member Posts: 11,120 Disability Gamechanger
    @leeCal that's awful guess it's the luck of the draw who you borrow off 

    Mine were so helpful 
  • leeCalleeCal Member Posts: 3,632 Disability Gamechanger
    I shouldn’t t say publicly @janer1967 but it was a bank. 

    Luckily i had pip and esa and managed to keep paying and then eventually I did qualify for the SMI before it was a loan. The smi then was a real life saver. 
  • laxylaxy Member Posts: 38 Connected
    @leeCal I completely understand I have ESA and pip which helps me financially. My bank wasn't helpful at all despite my health condition Crohn's  which let me down and waiting for emergency surgery for stoma .bank didn't care took me to court repossession of my home was given 28 days judge said " well it is banks money and they Wana it. Look somewhere else to live " that's was his words. Didnt care I had a three year old son .Luckily I had private pension and I took I'll health pension to save my home.  Now I'm eligible for smi i Wana take it but scared that I may end up over paying interest amount ......
  • laxylaxy Member Posts: 38 Connected
    Now cause of all missed payments in 2020  no will give me mortgage. I'm up to date with payments since laster December but my bank is charging alot more after my fix is finished April end. The new fix is much more than now. Switching lender is out of question as everyone is saying it's hard cause of missed payments. Smi load is last option but scared  
  • laxylaxy Member Posts: 38 Connected
    Of I take smi which interest is 0.3%now and their rates change twice a year but is it good to take ? 
  • leeCalleeCal Member Posts: 3,632 Disability Gamechanger
    edited March 28
    thats a nasty experience.
    Have you read all the details @laxy? If you apply for it and you qualify they will send you an information pack which you can read through very carefully before making a final decision. 
    Best wishes.
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