Mortgage overpayments due to SMI.

[Deimos]

Hi all

 

Quick question, we've been getting SMI payments for our mortgage for the past couple of years now and we've only just noticed, the SMI payments aren't taken off the direct debit amount we pay each month, instead, that money has been lowering the amount of mortgage we owe.

 

We've tried to get this sorted with the mortgage company so the amount paid, is the total monthly amount, MINUS the SMI payments, but so far, we haven't had much luck

 

Santander (aka Abbey) have constantly messed up the agreements we've had with them, so I'm wondering what we should do?

 

The mortgage payment is due on the 1st of each month, however, the SMI payments show up in the middle of the month, so they've been taking the full amount due for the mortgage, then deducting the SMI payments from the mortgage total, rather than taking it off the next direct debit payment.

 

Is there anyway we can get this overpayment refunded?

[Ell-enn]

Hi there, if I understand this right they are getting the full mortgage payment and the SMI every month ? this must be giving you financial problems ?

Are there any arrears on the account ? if not then the easiest way to sort it out is to cancel the direct debit and set up a standing order so you pay the right amount.

[Deimos]

Hi there, if I understand this right they are getting the full mortgage payment and the SMI every month ? this must be giving you financial problems ?

Are there any arrears on the account ? if not then the easiest way to sort it out is to cancel the direct debit and set up a standing order so you pay the right amount.

 

Hi ell-enn, thanks for the reply

 

That's correct, yes and it has given us financial difficulties and we did fall into arrears

 

(That's another story in itself)

 

We came to an agreement with their solicitors to pay an extra £50 a month to pay off the arrears and they would deduct the SMI payments from the direct debit, which they haven't done for the last TWO payments.

 

They've been taking both the normal mortgage payments and the SMI, for at least two years and we didn't even realise it.

[Ell-enn]

Have the arrears now been cleared ?

[Deimos]

No, there's about £3000 left.

[Ell-enn]

Have you written to them to ask them to change the amount of the DD to that which was agreed as you are suffering financial hardship ?

[Deimos]

Not yet, no, everything has been done over the phone, basically

 

What they've done for the past two months is use the dss/SMI money to lower the arrears, which isn't what we agreed to

 

We agreed to pay the full mortgage, plus £50, minus the two SMI payments, instead, they've taken the full mortgage, £50 and used the SMI amount to lower the arrears instead.

 

We were told to cancel the direct debit (which we've done) And send a check in every month, instead, which we've done

 

But I have a feeling they're going to use the SMI improperly again next month.

[Ell-enn]

Ask them for their bank details and set up a standing order instead of posting a cheque - they have a habit of not arriving at the right department or not being credited to the right account. If you do send any cheques make sure you write your name and address and mortgage account number on the back and staple it to a covering letter, but much better to set up a standing order as you are in control of the amount and when it is paid. Are you on internet banking?

[Deimos]

We are indeed, I Can make such payments through Barclays

I'll do that then, thanks Ell-enn

Do you think it's worth pursuing them for the overpayments?

[Ell-enn]

Have they been using the overpayments towards the arrears ?

[Deimos]

For the last two months, yes.

[Lea_HTH]

If you are in such financial straits as to require SMI, then how could you not possibly notice for TWO YEARS that they were taking both payments? Really? Most people who require SMI would undoubtedly notice that they were still paying the full mortgage payment.

 

I don't think the SMI can count as an 'overpayment', particularly if you are in arrears - and they are entitled to set off any additional payments against the arrears, or against the balance (if your mortgage contract allows that). Plus I don't see how it is possible to fall into arrears whilst paying full CMI and receiving SMI in addition. That makes no sense whatsoever.

 

I just don't see how this fits together. If you are 3K in arrears I don't see how you can reasonably expect them to pay back anything as given the arrears there are no 'overpayments'. Overpayments put you in credit, not deficit.

[Deimos]

Yes Lea, really.

 

The mortgage is in three names, the money was coming out of my uncle's account (Three people own this house)

 

He was the one who got the statements and was making sure everything was paid, he didn't realise more money was coming out of his account than should've been.

 

So we didn't know, until he stopped paying the mortgage entirely in October 2010, we didn't find out till April 2011 almost that he hadn't been paying it, hence, the £3k+ of arrears.

 

Making sense now?

 

I can't remember when I applied for SMI, but it was at least 2 years ago, so it's more than the arrears, far more.

[Lea_HTH]

Yes Lea, really.

 

The mortgage is in three names, the money was coming out of my uncle's account (Three people own this house)

 

He was the one who got the statements and was making sure everything was paid, he didn't realise more money was coming out of his account than should've been.

 

So we didn't know, until he stopped paying the mortgage entirely in October 2010, we didn't find out till April 2011 almost that he hadn't been paying it, hence, the £3k+ of arrears.

 

Making sense now?

 

I can't remember when I applied for SMI, but it was at least 2 years ago, so it's more than the arrears, far more.

 

That's interesting...

 

For several reasons, but largely because SMI, after 5th Jan 2009, is only payable for two years (if on iJSA - not IS, PC, or ESA)), so you might find you're opening a can of worms by asking about 'overpayments'. You might find yourself being asked to repay some of it if they've missed you in the rule change!

[Deimos]

I'm on IS, try not to assume.

I'm here for advice, not assumptions and rudeness.

[Lea_HTH]

I'm on IS, try not to assume.

I'm here for advice, not assumptions and rudeness.

 

I was not rude, nor did I assume - you might want to re-read. I queried what you were stating. If advice is going to be given, the correct information has to be ascertained FIRST. If it offends you to be asked questions about your circumstances, then you will not get the help you need, you will simply be offered platitudes and directions by those who want to help, but aren't because they didn't ask the right questions to ascertain the facts.

[malcolmmirt]

OK, calm down kids.

 

-I think (don't know) that they will be entitled to take these 'overpayments' against your arrears.

-But the current arrangements should be as agreed with them of course - cancelling your DD seems sensible (but need to keep up with payments).

-Certainly you need to get all this from them / you in writing.