If you are a homeowner you cannot receive help with mortgage payments from UC. However, you may be able to receive the housing element for some service charges. You will be asked for details of these when you claim UC.
If you claim UC and have had no earned income for 9 consecutive months you may be able to get help from a Support for Mortgage Interest Loan (SMI). If you're thinking about claiming a SMI loan, consider getting advice from a money adviser.
NOTE: If you own your home and live in it, it is disregarded as capital.
Lodgers and non-dependants
Having lodgers and non-dependants living with you in a home you own, has no impact on your Universal Credit and their earnings, savings and other income are ignored by your UC.
Support for Mortgage Interest (SMI) loan eligibility
If you are claiming UC, you cannot get a support for mortgage interest loan if you have any of the following income:
Earnings from either employment or self employment
A tax refund
Statutory Sick Pay
Statutory Maternity Pay
Statutory Paternity Pay
Statutory Adoption Pay
Statutory Shared Parental Pay
To be eligible for the SMI loan, you must have been claiming UC and not had any of the above named income for nine consecutive assessment periods. If are in receipt of a SMI Loan at the time of your UC claim (as you were in receipt of legacy benefits), this will continue.
If you have any of the above you will need to complete 9 consecutive assessment periods with no earned income.
If you qualify, you will receive help paying the interest on up to £200,000 of your loan or mortgage.
Support for Mortgage interest is a loan and there will be a charge on your property. You will need to repay the loan with interest when you sell or transfer ownership of your home, although recent changes mean you can now transfer the loan to another property.
Support for Mortgage interest is usually paid direct to your lender.
How to Apply
When you make your UC claim one of the questions is whether you have a mortgage. UC will check if you qualify for the support for mortgage interest loan and send you a booklet to read that explains about the loan and how to apply. This will be followed by a phone call from your case manager who will ask whether you are interested. If you are interested, they should go through their information booklet with and check that you have sought independent advice. If you still want to go ahead with the Support for Mortgage Interest loan they will send the paperwork out to you to sign.
There will be a section of the form for your mortgage lender to complete and they return the full paperwork to UC.
Repaying your loan
You will not be asked to sell your home in order to repay your support for mortgage interest loan. If you sell your home you will repay the loan from any money left after you pay
Any home improvement loans
Any other loans secured against your home
If there is not enough left to repay the loan it will be written off.
If you want to transfer the loan to another home you need to contact debt management as soon as you know you will be moving and before your complete the sale.