Many poorer families could be in danger of having their home repossessed as a state-backed benefit is taken away [Image: Alamy Stock Photo].

Ridiculous.

The Conservative government is trying to squeeze money from homeowners on low incomes by replacing a scheme that pays the interest on their mortgage with a loan.

The idea is to continue paying the interest on mortgages, to keep new homeowners from defaulting on their payments while they are in financial difficulties – but to then charge interest on those interest payments.

Interest on interest – bizarre.

The fact is that this is a government loan shark scheme. The people it targets may never be able to pay off the charges they incur, because Tory austerity, economic mismanagement and the effects of the government’s ridiculous Brexit mean no job currently pays enough to lift them out of debt.

It is no wonder, therefore, that the scheme has attracted a pitifully small amount of interest. It seems more than 117,000 of the 124,000 receiving the current benefit would rather default on their mortgages, running the risk of losing their homes.

One has to ask:

Is that the underlying plan? Tories love to get their hands on other people’s property in underhanded ways.

The government has been called on to delay a new “second mortgage” scheme, which replaces a benefit for homeowners on low incomes, after just one in 20 affected households have signed up for it.

From April, the government is axing “support for mortgage interest” (SMI) which helps financially constrained homeowners with their mortgage. It will be replaced with a controversial system where the government offers to loan people the money, which will be repaid later with interest.

However, new figures have shown that just 6,850 households have signed up for the scheme out of the 124,000 currently receiving the SMI benefit, prompting calls for the changeover to be delayed.

Source: Anger as thousands unaware they face a ‘second mortgage’ | Money | The Guardian


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