News
January 2009
Support for mortgage interest update
If you are claiming Pension Credit and you are a homeowner, your benefit may include additional support for mortgage interest (SMI).
SMI assists people with the interest on their mortgage. The rate is based on a standard interest rate of 6.08 per cent for six months.
Some people will experience a temporary drop below 6.08 per cent. This is because it takes time to adapt our IT systems, but we are taking urgent action to ensure that customers do not lose out.
A corrective adjustment will take place, for a period of five weeks, from 2 February to 8 March 2009. During this time, customers will receive an increase in their benefit to compensate them for the earlier reduction. Then, from 9 March, benefit will be readjusted to the correct level with the standard interest rate set at 6.08%.
It is possible that the reduction in benefit could have a knock-on effect for those customers who are also claiming Council Tax Benefit. This is because entitlement to certain benefits can carry with it a linked entitlement to Council Tax Benefit. We are working hard with local authorities to ensure that Council Tax Benefit is not affected.
If this affects you and you require further advice, you can contact your local authority or pension centre.