Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, pursuant to the Answer of 21 May 2018 to Question 133903, what assessment her Department has made of the financial effect of the loss of equity caused by repaying the loan that has now replaced Support for Mortgage Interest at the point of sale of the home.

The average amount of SMI loan repayable upon the sale of the home is estimated at around £1,200 after a year, increasing to around £4,000 after 5 years.

DWP has produced tables that provide examples of how SMI loans might accrue over time and these are included in the Frequently Asked Questions that are issued to claimants after they have had the information call with Serco. In many cases the recovery of SMI loans will impact the beneficiaries of the recipients of SMI loans. Without the provision of the SMI loan it is possible that the property would have been repossessed by the mortgage lender.