On 24 April the DWP published the latest statistics on the switch from paying Support for Mortgage Interest (SMI) as a benefit to giving it as a secured loan giving numbers as at 18 April:
- how many people getting SMI have been sent letters and successfully contacted by phone;
- what the people who have been successfully contacted are choosing to do – take the loan, decline the loan or are currently undecided.
I commented on the previous statistics here: SMI watch – 25 March – no real progress in last week.
A large technical problem with the March figures
The DWP says:
Since the publication of the earlier figures in March, a technical issue has been corrected on the Management Information system used to produce the figures. The issue resulted in around 13 per cent of claimants’ records being moved to a new loans system ahead of the introduction of the SMI loan scheme on 6th April and meant they were missing from the earlier figures published in March. No correction will be made to the figures in March. Figures for March and April are therefore not comparable.
But I am giving the previous figures for comparison anyway. I know it’s apples and pears but there is no other way of trying to see what is happening. The incomplete old data is in blue:
The missing 13% of data in the March figures shows up clearly: the number of SMI benefit claimants was reported then as only being 90,000 and now has been corrected to 103,000.
Surely someone from the DWP should have looked at the previous data before it was published and asked why so many fewer people were getting SMI than previously thought?
My comments
- two weeks after the old SMI should have ended, only 10,000 people have actually completed the new loan documentation;
- the large jump in “successful contact made” numbers – we can’t tell if this is substantial progress in the last few weeks or the previous low numbers were just wrong;
- only 5,000 more people seem to have decided to accept the loan in the last few weeks (and that could be lower if the previous numbers were wrong). That is not exactly a rush to sign up at the last minute that Kit Malthouse, the DWP Minister, said may happen;
- the “undecided” percentage has dropped, but most of them are deciding to reject the loan.
Overall these figures are not encouraging. The numbers rejecting the new loan look simply unsafe.
Some people will have good alternatives to the new loan but no-one, including the DWP, expected them to be anywhere near as large as they are at the moment. Many of these people may have made an unwise decision.
Are you trying to decide on the new loan?
If you have been getting SMI and you are trying to decide what to do, read SMI will be a loan from April – should you agree to this?
You can change your mind if you told Serco you don’t want the loan and you realise this was a mistake. It is possible to sign up to the loan with no waiting period and even get the loan backdated to April if you want – see SMI – what happens if you haven’t agreed to take the loan?
Suzanna says
Seems Kit may be right in the end, only 10,000 have signed up leaving 8000 to return paperwork out those who agreed to take up the loan. Couple that with the 12,000 that are undecided then you get a rush of 20,000 people making a loan apllication at the “last minute” thats nearly 20% of the overall number on SMI.
I dont think anyone has a crystal ball and can say with any certainty on when and how many will apply. 103,000 receiving the assistance which is mortgage related somthey must live there, have received notification. People not replying or answering their phone is their choice. Having been a Citizens’s Advice Trustee in the past I know the saying ” you can lead a horse to water but you cant make him drink” very much applies in matters of advice. I would hazard a guess that when the benefit stops there will be a mad rush of enquiries.
Sara (Debt Camel) says
Well my crystal ball has never been much good… but the percentage declining the loan appears to have gone up a lot, this could be to do with the DWPs data problems but it doesn’t feel like a mass rush of the undecided to sign up at the last moment.
“People not replying or answering their phone is their choice.” Many of the SMI recipients would be classified as vulnerable by a debt advisor and many may not answer phone calls from someone they do not know.
steven rossiter says
I have received the documents and signed them, but I can not send them back as I still have questions which they themselves have said they are unable to answer. It is clear when speaking to the DWP this is a new situation for them also and no one has presented the scenarios I have presented. Frankly if the DWP cannot provide the answers then no one can.
Sara (Debt Camel) says
I think some of your questions have been answered? which are the remaining ones?
Anne Walker says
I signed up and as at 11th June I have yet to see any payments on my mortgage account leaving me to find an extra £80 a month out of my ESA & Pips… I’m already having to pay £240 mortgage leaving me without enough money to live properly but forced to stay here as I have nowhere to go if I sell and not enough equity to finance a move (In any case any money left over from a sale doesn’t arrive until after the event so I’m trapped) can’t save as I’m having to pay mortgage etc.. I didnt foresee having to stop working due to chronic illness or being trapped in a house now unsuitable for my needs. It’s frustrating. I’m spending hours at a time on the phone to the DWP just to speak to someone atm, managed to get through 10 days ago, form logged on system, no obvious reason why they haven’t paid. Promised telephone response never materialised, still no payment, so I’m back to spending days on the phone trying to get through!
Sara (Debt Camel) says
I am very sorry to hear this. The money will be paid at some point, and backdated to when the benefit stopped, but this must be very worrying and stressful for you.
I am also concerned that the propoerty isn’t suitable for your. Would your GP agree with this? It may be worth talking to your local council about help to move to somewhere more suitable.
Jayne says
I still havent received any correspondence or a phone call
I am still getting my payments to my mortgage
does this mean they have set up a loan already without me knowing
Sara (Debt Camel) says
No, they can’t have set up a loan without you knowing. A loan of any kind is not legal without you agreeing to this, And this is a secured loan, so the agreement you have to sign is long! Without this there is no loan.
deni case says
I have a question. I’ve now been forced to apply for the SMI loan. No choice. I have a ream of papers from the DWP but am still completely unclear as to how much I will have to pay every month and nowhere on the form do they ask how much my mortgage is or the interest rate I’m currently paying. Before I finally sign, my question is – if I have a 60K mortgage and am paying 1.89% fixed for 2 years, what will the DWP interest be per month on that? Thank you.
Sara (Debt Camel) says
The interest rate used to calculate the amount of SMI you’ll get is currently 2.61%. It doesn’t matter what you are paying. Bonkers system…
STEVEN ROSSITER says
@ 30 06 19 DWP report 78% of 102,000 applicant allegedly “declined.” DWP confirm “declined” to include the undecided who remain unresponsive following receipt of an application after 6 weeks. To me these figures support that for many the facts required to submit an application may not yet be established or understood. Therefore the DWP disingenuously determine the undecided as declinede. I still have not made a decsion and Kit Mathouse has written several letter back to me.
There is no reason to suspect the new ability to port SMI loans as an altruistic endeavour by Government, rather, the absence of porting had the potential for claims perhaps eventually leading to the litigious endeavours of claimants who may have found themselves discriminated against and somewhat imprisoned without an ability to move. Home repossessions are rising for 2019/2020. The economy is good, so are the 2017 SMI regulation contributing to increased repossessions?
Whoever designed SMI paid no attention to the unreasonable effect it would have, opting instead to amend the regulations as far as possible, whenever required in order to survive probable litigation due to provision of such legislation as the Equality Act 2010. Allowing backdating and the new ability to port, will allow time for applicants to continue their indecision so that the imposition of these regulations may continue to cause difficulty for this most affected group hidden from public concern or complaint.
Sara (Debt Camel) says
“so are the 2017 SMI regulation contributing to increased repossessions?” that is an interesting question. My guess is that if SMI was being a significant factor, then the advice sector would have heard about this, and so far we haven’t.
STEVEN ROSSITER says
I’m just posing the question at the moment. Nationally the increase is marginal, but it would be as the provision of eligible SMI claimants is also small. I have written a Case Study being sent widely if you are interested in reading further what difficulties I suggest are a cause of the lack of applications. It is being well received by organisations such as CAB and Shelter. Im pretty sure you do not accept emails so do not know how to send it.