What help is there if you can’t pay your mortgage
Let’s look at what help with mortgage payments are available in the UK, if you are having difficulties paying your mortgage.
Government help with mortgage (SMI) UK
The government gives support to home owners with payments towards the interest of their mortgage. So, this is not paying towards the mortgage itself, just the ‘interest’ part of the mortgage.
So, if you are a home owner you might be able to access this support. This support from the government is called Support for Mortgage Interest (SMI).
You can also access this support if you have taken out any loans for improvements or repairs for your home. So, you can use the SMI payments to pay for the interest from any loans you had taken out for your home.
The SMI support is a loan that the government gives you, which you must pay back with interest added to it, when you sell or transfer ownership of your property. This is unless, you are transferring the loan to another property.
To be eligible for the SMI you usually need to be on benefits such as:
Income-related Employment and Support Allowance (ESA)
Income-based Jobseeker’s Allowance (JSA)
When you apply for the loan, it is not guaranteed that you will get it.
When can you apply for SMI
If you are on Pension Credit, then you can get SMI from the date you start getting your Pension Credit.
You have to be claiming Income Support, JSA or ESA for 39 weeks in a row to qualify for SMI.
If you are on Universal Credit for 9 months in a row then you can claim SMI, unless you are getting any of these Statutory pay: Sick Pay, Maternity Pay, Paternity Pay, Adoption Pay, Shared Parental Pay.
Please check out further details on help with mortgage payments at the GOV.UK site: Support for Mortgage Interest.
For Wales check get more details here: Support with Mortgage Interests.
Home Owners’ Support Fund (Scotland)
If you live in Scotland and you are in risk of having your home repossessed because you have not been keeping up with your mortgage payments, you might be able to get the Scottish government’s Home Owners Support Fund.
The Home Owners’ Support Fund is made up of two schemes, these are:
Mortgage to Shared Equity – this is where the Scottish government will buy a share in your home. This means your overall mortgage will be reduced as the government has paid in for a share, so hence your monthly mortgage will go down as well – which might make it manageable for you.
Mortgage to Rent – with this scheme a social landlord will buy your home from you and then let you live there with rent.
You find out more here: Home Owners’ Support Fund.
Support from your lender
If you are having difficulties in paying your mortgage, contact your lender and let them know. Ask them if there is any support available for this.
They could make suggestions such as switching to interest payments only. This means, you will only be paying the monthly interest on your mortgage and not the mortgage itself.
They might also suggest to you to lengthen your terms of repayment so your monthly payments go down.
Financial and debt advice
You can contact these organisation for free advice on finance and debt:
Contact Citizens Advice: Citizens Advice.
Contact StepChange Debt Charity: StepChange.
Contact National Debtline: National Debtline.
Difficulties paying energy bills
If you are having difficulties paying your energy bills, check out our article: What to do if you can’t afford to pay for your energy bill.
If you would like to switch energy supplier, check out our article: Switch Energy Supplier For a Better Deal.
We have looked at some options available for you in getting help with mortgage payments. And, also provided some additional information on where to get free financial and debt advice.