Can anyone explain the logic of this please?

MissAdventure

It's not the same situation, so people won't get exactly the same help.
Do you think we should pay people's mortgages?
There are people who would be only too happy to point out that people shouldn't have taken on a mortgage for others to end up footing the bill.

The loan is cheaper than a credit union one, as well as every other option, and in reality only needs paying back if the property is sold.

The loan may not be repayable unless the property is sold, but interest is charged on it, so repayment largely depends on how long you want to go on racking up the debt, which then eats into the equity of the house if/when you’re in a position to move up the ladder.

Let's not shilly shally about the willy nilly.
I think we're all of
the same opinion, really.
It's crap any way round.

I am not at all suggesting that benefits are thrown around willy nilly. I am fully aware that it can be a long, humiliating and frustrating process to get them, and that they are too low for people to live on comfortably. My point was in response to whoever said that help with mortgages is in the form of a loan, unlike help with rent.

It is a long time, I think. (Probably long enough that people may well be back in work by then; conveniently)
Not that it applies to me, but I just wanted to point out that benefits are not thrown around willy nilly to some and not others.

Well, I suggested this further up the thread and I was told that the government no longer paid mortgage interest, which was news to me, but I accepted that my knowledge was a bit out od date.

I have a feeling that you have to wait some months before you can get it, possible there was some confusion.

Like they're currently doing, you mean?

www.turn2us.org.uk/Benefit-guides/Support-for-Mortgage-Interest/How-much-Support-for-Mortgage-Interest-will-I-get

I suggest that the government go back to the old system of paying the interst but not the capital part of the monthly payment.

I can understand the viewpoint of those who don't want to help buyers but I do not agree with it..
Not helping mortgagees is a major flaw in the benefits system, which the government just ignores. But then this is a government that thinks foodbanks are acceptable.

Yes, I know - so all the more reason for people with mortgages to get the same deal as those who rent (ie get housing costs paid if they are unable to work).

Things always change, when you think you know the answer!

Doodledog renting is more flexible. If you do not keep up with mortgage payments, the lender can foreclose and the house will be sold, but this may take time and the debt builds up and after all is sorted you may still be in debt to the mortgage lender. Not only that it make getting amortgage again later more or less impossible.

With renting, you can just give notice and go, perhaps to something smaller and cheaper. If you do go into arrears, you can also stay where you are until evicted, with no worse problem than a poor credit score.

Sorry - that should be DWP not duo !!

@M0nica. I don't think the duo offer help with mortgage interest any more.

I genuinely can't understand people not wanting to fund a mortgage if they are happy to fund rent.

If someone has been made redundant, or is too ill to work (or has another valid reason for not working) and they have paid into the insurance scheme that covers welfare, they should be able to claim on it, regardless of their situation. I can understand people feeling that this can't go on for an indefinite period so that a claimant could get a house paid for by the state, but as has been said, rent payments will go to a landlord, who will get their mortgage paid, or their assets increased, and I don't see why people would be happy to do that but not pay towards a mortgage. The unemployed and the sick have to jump through hoops to be able to claim, so it's unlikely to be abused in the short-term. Maybe after a year the funding could stop, although quite where people who are unable to work are supposed to live, I don't know.

It's very complex and no easy answer.
Working people on low income will get help with rent but not mortgage. I can understand taxpayers not wanting to fund a mortgage, but there should be some proper form of help, or more long term rentals.
Surely it would be in the government's interest long term to help councils provide more social housing, rather than pay large rents to private landlords.
And to go back to the original post, there is no logic behind low wages from companies making a fortune.

That's fair enough - I was querying why some people are given a loan and others have their housing costs paid.

I am picking up on a few posts above, so may be misinterpreting the direction of the thread.

When those with mortgages get help with housing costs, it is usually interest only, nothing towards the capital repayments, so their situation is no different from someone renting. Once back in work, they will go back to paying capital and interest, but with a backlog of capital to pay off.

The loan is only repaid when and if the property is sold on.
I have no idea what happens if it never is sold.
Yes, it doesn't seem fair, I agree.
As home owners, people are responsible for repairs, etc, which have to be paid for out of benefit money, which also doesnt sit right, if we want to go through each situation.
A renter would have the landlord to do running repairs and major ones.
Those who are 50p over the amount which qualifies them for benefits will miss out, too.

It's such a complex state of affairs these days.

No worries

But one is a loan and the other non-returnable? If so, that is not equal.

Ooh.
I think I've read that wrong.
Apologies.

Still though, anyone who is out of work will be entitled to the same amount to live on, across the board.
Those who rent will get help towards it, those with a mortgage will get help towards that, with end result that both are housed, with the same amount to live on.

Surely that's contradictory?
Higher earners will get more under your system.
That isn't equality.
That's a value judgement.

As you say, people won't get exactly the same help. In my opinion, if they pay the same tax and NI (and I stress that I think the system needs to be reformed so that high earners pay more and low earners less than now) then they should get the same help, irrespective of whether they rent or pay a mortgage.

I firmly believe that the welfare state should be fair, equal and available to all who have paid in, with provision made for those who are unable to do so. I don't think that the government should decide who qualifies and who shouldn't, whether that is based on marital status, housing situation or whatever. Payments should be based on contributions, with no value judgements.

Who isn't getting help?
Anyone whose income falls below the allowed amount will and does get help.

MissAdventure

It's not the same situation, so people won't get exactly the same help.
Do you think we should pay people's mortgages?
There are people who would be only too happy to point out that people shouldn't have taken on a mortgage for others to end up footing the bill.

The loan is cheaper than a credit union one, as well as every other option, and in reality only needs paying back if the property is sold.

Paying money towards rent is likely to be paying the landlord's mortgage though, so what's the difference?

I believe that there should be a better system of taxation, and people should be able to claim on NI when they need it. Fair enough, there should be checks and balances, but I don't see why some people should get help and others not, if both have paid tax and NI.

We should look at the way other countries deal with supporting the poorest in society and learn how things might be done better.

The gulf between rich and poor in the UK is wider than almost any country in the developed world.

Such inequality breeds extreme politics and the manipulation of public opinion by the extremely wealthy through their control of the media, especially our predominantly right wing national press.

growstuff

MaizieD

growstuff

Maizie NICs don't depend on the hours somebody works, but the amount.

Anybody earning £184 (or more) a week pays NICs. That works out to just over 20 hours a week on minimum wage. but would obviously be fewer hours if the person earned more.

I told you. I was working it out on 16 hours paid at the current minimum wage of £8.42 per hour. I am not altogether stupid you know.

But why are you obsessed with 16 hours? It's irrelevant with the current system.

PS. The current minimum wage for those 23 and over is £8.91 per hour.

Because someone was querying why people worked 16 hours.

Apologies for getting the minimum wage wrong, I must have been looking at out of date figures. I don't think that an extra 50p (ish) per hour will make enough difference to their income to put them into the NIC payment bracket. Will it?