Mortgage interest loans
From 6 April 2018, repayable loans replaced the previous benefit support for mortgage interest on certain loans secured on a client’s home. Clients getting IS, income-based JSA, income-related ESA or pension credit (PC) can qualify for a loan. The loans can cover the interest on mortgages or other payments used to purchase a home, or the interest on a loan to pay for specified repairs or improvements.
A client should be advised to seek independent financial and legal advice before taking out a loan for mortgage interest.
The loans attract interest, which will continue to accumulate until the loan is paid or written off.
Clients may still be able to get an amount for housing costs included in their benefit for service charges, ground rent, co-ownership schemes or certain types of rent.