Mortgage Interest Support, MI12 and JSA3

[BlurredFX]

Pre-Budget Report: Home owners struggling to pay their mortgage get extra help from Chancellor - Telegraph

 

He has extended it at the current rate for six months, and I therefore guess the next announcement will be the actual budget. Can't see him pushing a load of people onto the street before an election, frankly. I hope to be in work by then, but it is a vital help.

 

We knew it would be reviewed today, so it's all good people!

 

Blurred

[BlurredFX]

FT.com / Personal Finance - Struggling homeowners? support extended

[MissFluffy]

Hi BlurredFX - do you know for sure that the 6.08% is a fixed rate rather than a ceiling rate??

I am currently in the 13 week waiting period and it is my understanding also that the rate is fixed so if your interest rate is less than 6.08% then the extra is deposited back to your bank account and can go towards paying off the capital!!

Saying that - I have also read that if your mortgage rate is a lot less than 6.08% (5% or less) they will only pay the interest charged by your bank.

I have tried to ask my bank, the job centre, and tried to find the answer on dwp website but nobody seems to know the answer (shock!!)

Now my interest rate is only 0.5% so although it would be great if they paid 6.08% I just can't see how they can!!

As you have just been through this procedure I wondered if you could help me any further??

[nks22]

Hi BlurredFX - do you know for sure that the 6.08% is a fixed rate rather than a ceiling rate??

It's a fixed rate.

 

I am currently in the 13 week waiting period and it is my understanding also that the rate is fixed so if your interest rate is less than 6.08% then the extra is deposited back to your bank account and can go towards paying off the capital!!

The surplus doesn't go to your bank account - the lender keeps it and, AFAIK, it's up to them what they do with it. I asked mine (BoS) about this as I'm on SVR of 4.84% and they said they put it to one side to cover any future shortfall in repayments and won't use it to reduce the capital.

 

It's something I plan to take up with them but at present I'm still in arrears, although the extra interest will cover those within a few months. Not that I'm not very grateful for the help but don't see why BoS should benefit from the government's generosity rather than me!

 

I have also read that if your mortgage rate is a lot less than 6.08% (5% or less) they will only pay the interest charged by your bank.

 

I haven't heard that and I'm receiving the full 6.08% for my 4.84% mortgage rate.

[nks22]

Incidentally, you can also claim for things like service charges (e.g. if you're a leaseholder in a flat with a charge for cleaning of common areas). It's not clear exactly what will be covered; I was told just to apply and they'll pay for whatever they decide is eligible.

[andydd]

Thought I'd answer a few questions that ive noticed.

 

Youll get interest paid at 6.08%, if your rate is lower (mine was only 2.5%) then it will be overpaying it and hopefully be paying some of the capital

 

Of course if your interest rate is higher then youll be expected to make up the rest.

 

You can also get help with service charges (you'll need to provide the Job Center with upto date service charge/ground rent demands).

 

You can get help with other secured loans (however they are very picky about what qualifies, buidling repairs and essential items, cookers, etc may qualify but HD TV's wont !).

 

Andy

[MissFluffy]

Thanks for your help on this.

 

BTW nk22 - I have asked my bank (HSBC) that if the interest payment from DWP covered more than my interest due where would the extra go?? They advised me that it would be credited back to my Bank Account.

I don't know whether different banks have different policies but I can understand your point that if anyone is going to benefit from the extra it should be you and not the bank.

[BlurredFX]

Miss Fluffy, the link in my post above your post shows you the facts about the 6.08%

 

I have also read that if your mortgage rate is a lot less than 6.08% (5% or less) they will only pay the interest charged by your bank.

 

I have heard this, but suffice to say my interest rate is below 5% but I am getting the full 6.08% - and I am not in a hurry to question their judgement on that one!!

 

The DWP only sent me the required form about 6 weeks after I became entitled to the benefit - luckily I had been on the case and got the MI12 and JSA3 forms at two months and submitted them in good time. I had a stand up argument with 4 members of staff in the JC before the manager came over and informed them all I was right!!! I don't think they broadcast it as they do not want people sitting round doing nothing and getting their mortgage paid. But the scheme is there, and you should get those forms filled in and submitted in good time. It was quite quick once I had the forms in.

 

I don't know what happens with the over-payment - mine is currently reducing my arrears.

 

Hope this helps

 

Blurred:-)

[MissFluffy]

That certainly does help!! I have submitted the forms but at the moment I am only in my 4th week of receiving income support so another 9 to wait!!

 

Thanks for everyone's help on this!!

[BlurredFX]

I don't know what happens with the over-payment - mine is currently reducing my arrears.

 

I am going to check this you know....

[BlurredFX]

Hi Guys,

 

Miss Fluffy - how are you progressing? It must be coming up time for them to be paying out. Any news for the forum?

 

I thought I would update you all on my case - and why I am starting to see why people have gripes with GE.

 

Recently, I received a letter from GE, headed:

 

"Call today to avoid repossession with a Personal Mortgage Recovery Plan"

 

It then goes on to say that they could restructure my payments and please give us a call etc etc.

 

I can't say for certain, but I think they want scare the wits out of me and then find a way of changing the terms of my mortgage, as frankly, the terms are quite good for me (and bad for them) - there is no way I would get the current terms unless I had about 25% deposit and a perfect credit history!! A less informed person, or perhaps someone in a worse situation than me may well have panicked, done what was asked, and then signed off on some new, less favourable, terms.

 

Anyway, I called them and spoke to a really nice lad. We went though my account, realised my arrears are now down to £300 odd, and that with the payments coming from the DWP my arrears would be cleared within 6 weeks anyway. He agreed that there was no point in doing anything, and we left it at that!!

 

I asked him what would happen to the overpayments once the arrears were cleared, and he went away to ask his boss, but was unable to provide an answer.

 

Given that there is a reasonable over payment going on, I would be most grateful if it went to me. I can see no justification in their keeping it - it isn't their money, it is my benefits!!

 

Does anyone have any thoughts about claiming this over payment back, once it happens?

 

Hope this thread continues to help, and would be grateful for any input on my query.

 

Blurred:)

[BlurredFX]

Just spoke to GE about potential over payments, and the fella I spoke to was a bit of a snot bag, but hey ho.

 

He says that I need to speak to the DWP and ask them to pay GE one amount, and the balance to me! I said, why, it's GE who have MY money, and we ended up in a circular argument. He started on about Anti-Money Laundering - bad move, as I know this legislation inside out. We both realised we were getting nowhere, and ended the conversation.

 

The up-shot is that I did not get a sensible answer what-so-ever!!

 

Ah well, I will persevere!

[andydd]

blurredFX they will pay whatever your interest rate is UP to 6.08% its a ceiling figure noy a set figure. However if your mortgage came down during the period they will pay up to 6.08% they would still pay the higher figure.

The rate they will pay as a maximum is set at the BOE rateplus I believe 1.51% the reason it is so high at the moment is that the chancellor specifically extended it at the higher rate first for 6 months and then again for another 6 months and it is set to revert to its "normal" rate in January.

Sorry to disappoint.

 

Thats not true, they pay the 6.08% figure, whatever your mortgage rate is, if its higher you have to pay the rest, if its lower then the overpayment will pay off some of the capital, Ive had mine paid for the last few months and this is exactly what happens.

 

Andy

[mercyblue]

andy as you can see on the thread I did say that I was indeed incorrect in just about the next post so I don't see why there was any need to post that again.

[nks22]

if its lower then the overpayment will pay off some of the capital

 

Possibly but it seems to vary depending on the provider. Mine (BoS) say they'll just hang on to it in case of future arrears - something I plan to challenge once I'm in credit.

[BlurredFX]

something I plan to challenge once I'm in credit.

 

Me too. Any thoughts on how to challenge this? I know the DWP are paying the flat rate @ 6.08%, but I am wary of getting too stuck in with the DWP because, as has been mentioned earlier in this thread, they did say that if your rate is below 5%, that is what they pay - though it seems this hasn't happened in reality.

 

Suggestions on how we get OUR money from the Mortgage Co's? I know it seems daft, and there is every chance the rate will change in the Budget, or post-election if the Tories win, but I have paid some serious tax over the years and don't feel too bad about getting a bit of it back, frankly.

 

Blurred:)

[BlurredFX]

if its lower then the overpayment will pay off some of the capital, Ive had mine paid for the last few months and this is exactly what happens

 

This happens in your case Andy, but do you KNOW that that is what happens for everyone? Is that the rules, or is it down to each lender to decide?

 

FX

[nks22]

I don't see that the lender can justify treating payments in a different way because they come from the DWP rather than the borrower. I expect to have any surplus taken off the capital as it would be if I'd chosen to make overpayments myself.

[ltc1607]

sub

[andydd]

This happens in your case Andy, but do you KNOW that that is what happens for everyone? Is that the rules, or is it down to each lender to decide?

 

FX

 

Jobcentre Plus - Working Age Benefits Support for mortgage interest

 

This says that the rate has been frozen at 6.08% and that is the rate that everyonbe gets, I very much doubt Im treated as a special case.

 

It has nothing to do with the mortgage company they arn't really involved, the DWP need to know their name and account number to pay them thats all, they pay the money 4-weekly so it does go a bit out of sync with monthly payments.

 

I had 2 mortgages one was at 2.5 % apr, so the 6.08% overpaid it by quite a lot, in fact it was only a few quid short of repaying all the capital too, my other mortgage was 5.5% so the payment was only a few quid over.

 

Andy

[BlurredFX]

This says that the rate has been frozen at 6.08% and that is the rate that everyonbe gets, I very much doubt Im treated as a special case.

 

Yep, it looks like you are right Andy. I had, and I think MissFluffy had, seen info out there are some point stating that if your interest rate was under 5%, then slightly different arrangements would apply. It now looks like we have some clarity - which is more important than each of us being right or not over one point. Well done mate.

 

It has nothing to do with the mortgage company they arn't really involved, the DWP need to know their name and account number to pay them thats all, they pay the money 4-weekly so it does go a bit out of sync with monthly payments.

 

It has everything to do with the Mortgage Co - they have the (overpaid) money!!!

 

My Mortgage Co had to fill in some forms (part of the MI12), detailing the original loan and any remortgages and what they were for. Mine was straight forward as it was one loan, for the purchase of my property. Other rules apply for second mortgages etc.

 

My arrears are now almost cleared, and we are trying to find out what happens to the overpayments once we are back on the straight and narrow.

 

Anyone else had any experience of what the Mortgage Co's do with any overpayments? What does their lender do? The more info the better!

 

This thread is turning quite informative, so good work everyone.

 

Blurred:)

[BlurredFX]

I don't see that the lender can justify treating payments in a different way because they come from the DWP rather than the borrower. I expect to have any surplus taken off the capital as it would be if I'd chosen to make overpayments myself.

 

Agreed. But what I would expect, and what happens are, sadly, now always the same!

 

Any experiences to share NKS?

 

Nice one.

[andydd]

Yep, it looks like you are right Andy. I had, and I think MissFluffy had, seen info out there are some point stating that if your interest rate was under 5%, then slightly different arrangements would apply. It now looks like we have some clarity - which is more important than each of us being right or not over one point. Well done mate.

 

 

 

It has everything to do with the Mortgage Co - they have the (overpaid) money!!!

 

My Mortgage Co had to fill in some forms (part of the MI12), detailing the original loan and any remortgages and what they were for. Mine was straight forward as it was one loan, for the purchase of my property. Other rules apply for second mortgages etc.

 

My arrears are now almost cleared, and we are trying to find out what happens to the overpayments once we are back on the straight and narrow.

 

Anyone else had any experience of what the Mortgage Co's do with any overpayments? What does their lender do? The more info the better!

 

This thread is turning quite informative, so good work everyone.

 

Blurred:)

 

By 'overpayments', do you mean paying off the interest and then some of the capital or paying off both and there is still some extra ? If if the former, then surely your mortage company is going to want that from you anyway ?

 

Andy

[nks22]

Any experiences to share NKS?

 

Not yet. Still in arrears!

 

By 'overpayments', do you mean paying off the interest and then some of the capital or paying off both and there is still some extra?

 

I think it's the excess over the interest payment due that the mortgage companies receive in the 6.08%. It's unclear what different lenders plan to do with the spare money.

[BlurredFX]

By 'overpayments', do you mean paying off the interest and then some of the capital or paying off both and there is still some extra ? If if the former, then surely your mortage company is going to want that from you anyway ?

 

I was on interest only from the outset. That might be significant... They may have a claim to it if the original mortgage was interest plus capital.:-?

 

It's unclear what different lenders plan to do with the spare money.

 

Would be good if people could share their experiences, so we can share the knowledge.

 

Also, I think it is worth noting, that there is a Budget this week, which MAY change things, and there MAY WELL be another Budget after the election...

 

Blurred:)