Support for Mortgage Interest
If you own your home and get certain income-related benefits, you may be able to get help towards mortgage interest payments. This is called a Support for Mortgage Interest (SMI) loan which you need to repay and it's sometimes known as ‘help with housing costs'.
What you can use SMI for
It can help towards mortgage interest payments:
- for a mortgage
- for a loan to buy
- to improve your home
What you can’t use SMI for
It cannot help you pay:
- the amount you borrowed (only the interest on the mortgage is paid)
- insurance policies
- mortgage arrears
How SMI is different to a normal loan
SMI is usually paid directly to your lender.
You don’t get a lump sum and no credit check is carried out.
Instead, the Department for Communities will make regular payments towards the interest on your mortgage and/ or some home improvement loans.
The total amount you owe will go up with every payment that is made.
For example, if the Department for Communities make 12 payments of £50, you would owe £600 (plus interest).
There are no fees to setting up the SMI loan.
How your loan is secured
Where the loan needs to be secured, the Department will place a charge (or in some cases a mortgage) over your property to secure the loan.
This means that when you sell your property or ownership is transferred, you must pay the Department back from any equity that’s left when your mortgage is repaid.
If the Department can't secure the loan by a charge (or in some cases a mortgage) it will still offer the loan and may secure it as a statutory charge on the property later.
Eligibility
You may be eligible for SMI if you are a homeowner and get one of the following benefits:
- income-related Employment and Support Allowance (ESA)
- Universal Credit
- Pension Credit
You can get a loan:
- from the date you start getting Pension Credit
- after you have claimed any other qualifying benefit for 39 consecutive weeks
- after you have been getting Universal Credit for three consecutive months - any earned income you get when you are on Universal Credit will affect the date when you can start to get Support for Mortgage interest payments
You might still be able to get SMI if you apply for one of the qualifying benefits but can’t get it because your income is too high. In this case you will be treated as getting the benefit you applied for.
You stopped getting SMI because your qualifying benefit stopped
You’ll start getting SMI again straight away if:
- you stopped getting Universal Credit, but you started getting it again within six months
- you stopped getting Pension Credit and you were moved to Universal Credit
- you stopped getting income-related ESA, and you applied for Universal Credit within a month
- you get income-related ESA and you apply for Universal Credit within three months of receiving a Migration Notice letter
If none of these apply, you’ll have to wait the normal period before getting SMI again.
What you’ll get
If you are eligible, you’ll get help paying the interest on up to £200,000 of your loan or mortgage.
This figure is £100,000 if:
- you get Pension Credit
- you started claiming another qualifying benefit before January 2009
If you already get SMI and move to Pension Credit within 12 weeks of stopping your other benefits, you’ll still get help with interest on up to £200,000.
The current Standard Interest Rate (SIR) used to calculate how much SMI you will get is 3.66 per cent.
If you have a lower interest rate than this, you will receive more SMI than is needed to meet your payments. These payments can only be credited to your mortgage account.
Before you apply for an SMI loan
Before you apply for a SMI loan you should find out:
- how much mortgage you have left to pay
- how much mortgage interest you pay
and
- other ways you can pay your mortgage interest
This will help you decide how to continue paying the interest on your mortgage and/ or home improvement loans.
Your annual statement from your mortgage lender tells you how much mortgage interest you pay. You can ask to stop getting SMI loan payments at any time.
It’s your responsibility to make sure you pay your mortgage interest. If you don’t your home may be at risk.
If you have a joint mortgage
If you have a joint mortgage, you must talk to the other person named on the mortgage about the options for paying the mortgage interest.
You both need to sign the correct loan documents before you can get a SMI loan. You should talk through your options together.
More information is available on Universal Credit - Support for Mortgage Interest
How to apply for an SMI loan
If you are getting a benefit other than Universal Credit
If you are getting a benefit other than Universal Credit, you can download and fill in the following claim form:
If you are claiming Universal Credit
If you claim Universal Credit, you can use your online account to ask to apply for SMI when you make a claim, or at any time during your claim.
If your Universal Credit changes or ends, your Support for Mortgage Interest loan payments may stop.
To check if you can get an SMI loan and for queries, contact:
or
Repaying your SMI loan and the interest rate
You’ll need to repay your SMI loan as a lump sum with interest if you sell or transfer ownership of your home.
From 1 July 2026, the Applicable Interest Rate (AIR) is 4.50 per cent. This rate can go up or down, but it won’t change more than twice a year. You will be told if it’s going to change.
Interest will be added every year until the loan is completely repaid or written off.
If you finish paying your mortgage, you will not need to repay your SMI loan unless you sell or transfer ownership of your home.
The Department for Communities will not make a profit from SMI loans. The interest you pay will be at a similar rate to the interest paid by the Department.
Examples showing how your equity affects what you pay back
These two examples show how the equity you have left affects how much you pay back.
Equity is the money left after you pay back everything secured against your property including your mortgage.
If there isn’t enough money left to repay the loan in full, don’t worry. The Department for Communities will write off the remaining amount and consider the loan fully repaid.
Example one
| You sell your property for | £95,000 |
|---|---|
| Outstanding mortgage amount (including any other secured loans) to pay back | £35,000 |
| Amount left | £60,000 |
| Support for Mortgage Interest loan amount and interest which will be recovered | £4,500 |
| Equity left | £55,500 |
Example two
| You sell your property for | £80,000 |
|---|---|
| Outstanding mortgage amount (including any other secured loans) to pay back | £71,000 |
| Amount left | £9,000 |
| Support for Mortgage Interest loan amount and interest | £9,600 |
| Amount recovered | £9,000 |
| Amount written off | £600 |
Voluntary repayments
If you want to repay the loan more quickly, you can make voluntary repayments.
The minimum voluntary repayment is £100 or the unpaid balance if it’s less than £100.
If you die before you've paid off your SMI loan
Leaving your home to a partner who lives with you
If you leave your home to your partner who you live with they’ll usually be able to inherit the loan with your home.
This means they will not need to repay the loan immediately. Interest will continue to be added until they repay the loan.
If you leave your home to anyone else
Anyone else who inherits your home, such as a partner you do not live with, your child or a friend, will need to repay the loan immediately.
They can repay the loan by selling the home or with other money, such as their own savings or any other assets you have left them.
If the home is sold, some of the loan may be written off. If they repay using other money, the full loan will need to be repaid.
Selling your home
You will not be asked to sell your home to repay your SMI loan.
If you sell your home, you’ll repay the SMI loan from what’s left after you pay:
- your mortgage
- any other loans secured against your home before you started getting SMI, including home improvement loans
If you do not have enough left to pay off all the SMI loan, you will have to pay back what you can. The rest of the loan will be written off.
How to repay
You should contact Department for Communities Debt Management.
The loan management team will send you a settlement letter telling you how much you need to pay.
You can pay:
- online - using the bank account details in your settlement letter
- by telephone - you’ll need your bank, building society or card details and your settlement letter
Other ways you can pay your mortgage interest
When you know your mortgage details you will need to consider how to pay your mortgage interest. There are a few ways to do this.
Contact your mortgage lender
Your mortgage lender may be able to suggest other ways to manage your mortgage payments. For example changing your mortgage interest rate.
Using savings and investments
If you have savings and investments, you could use these to pay your mortgage interest or bring down the overall amount you owe your mortgage lender.
You may want to seek financial advice before doing this. The Department will not pay your costs for this.
If you choose to do this, you will need to report this through your online account as using your savings may change the amount of Universal Credit you get.
Speak to a Credit Union, bank or building society
A Credit Union, bank or building society may be able to offer loans as well as savings and bank accounts. You’ll need to check what interest rates they charge.
Move to a different property
The size of your home and where it’s located can affect how much it is worth.
Moving home may change the amount of mortgage you need. You may be able to have a smaller mortgage, or you may not need a mortgage at all.
These are just some of the things you could do. There may be other options for you to think about.
Other financial help with housing costs
You can still get financial help with your housing costs if your income-related Employment and Support Allowance is going to stop because you are about to:
- return to work full-time
- work more hours
- earn more money
This is called the Mortgage Interest Run On. Learn if you qualify for a Mortgage Interest Run On.
Where you can get help and support
You need to decide if a Support for Mortgage Interest loan is the best option for you and your household. You may want to ask family and friends for help.
You can get free and impartial money advice from any independent advice office, or by contacting: