Support for Mortgage Interest Guide UK (SMI, Help with Mortgage on Benefits)

What Is Support for Mortgage Interest (SMI)

SMI is a government-backed scheme that helps homeowners pay the interest on their mortgage or home improvement loans if they receive certain income-related benefits. It is not a cash payment to you — instead, for new claimants since April 2018, SMI is provided as a secured loan registered as a charge on your property at HM Land Registry. The DWP pays the interest directly to your mortgage lender, and the loan is repayable with interest (at the same rate as your mortgage) when your home is sold, transferred, or upon your death (or the death of your partner). Before April 2018, SMI was paid as a non-repayable benefit — claimants who qualified before this date may still receive it as a direct payment rather than a loan. The scheme covers interest on: your main mortgage (up to a maximum loan of £200,000 for most people), home improvement loans secured on your property, and certain other secured loans used for essential home repairs. SMI does not cover mortgage capital repayments, buildings insurance, or mortgage payment protection insurance. You must be receiving a qualifying benefit to be eligible — SMI is not available to homeowners who are simply struggling with mortgage costs but not on benefits. For broader mortgage help, see our Mortgage guide →.

Who Is Eligible for SMI

To qualify for SMI, you must be receiving one of the following qualifying benefits: Universal Credit (with the housing costs element for SMI), Pension Credit (guarantee credit), Income Support, income-based Jobseeker's Allowance, or income-related Employment and Support Allowance. You must also own the property you live in and have a mortgage, home improvement loan, or other secured loan on that property. The property must be your main home — SMI does not apply to second homes, buy-to-let properties, or commercial premises. If you claim Universal Credit, you qualify for SMI automatically if you have housing costs and meet the criteria, but you must report your mortgage details in your UC account. You must have been receiving the qualifying benefit for a qualifying period — usually 3 months (or 9 months if you are on Universal Credit and claimed before April 2018). The 3-month waiting period starts from the date you first became entitled to the qualifying benefit. There is no capital limit for SMI itself, but because the qualifying benefits are means-tested, your savings and capital (above £16,000) may affect your eligibility for the underlying benefit — see our Universal Credit guide → for the capital rules.

How SMI Is Calculated and Paid

SMI covers the interest on your mortgage up to a maximum loan of £200,000 (or £100,000 if you are on Pension Credit). The DWP applies a standard interest rate to calculate your SMI payment — previously linked to the Bank of England's average mortgage rate. In 2026, the SMI interest rate is 3.13% (reviewed twice a year). This means the maximum monthly SMI payment is approximately £521 for a £200,000 mortgage at 3.13% (£200,000 × 3.13% ÷ 12 = £521.67). The DWP pays the interest directly to your mortgage lender quarterly in arrears (usually in January, April, July, and October). For Universal Credit claimants, SMI is handled separately from your UC payment — it is paid directly to your lender, not to you. The amount is calculated using the outstanding balance of your mortgage at the date of claim (not the original loan amount). If you have an interest-only mortgage, the calculation is straightforward — SMI covers the full interest amount. If you have a repayment mortgage, the DWP calculates the interest element only (the capital repayment is excluded). If your mortgage interest rate is higher than the DWP's standard rate, you will only receive the standard rate amount — you must make up the difference yourself. For mortgage overpayments, arrears, or additional borrowing, the rules differ — see our Mortgage guide →.

How to Apply for SMI

The application process depends on which qualifying benefit you receive. If you claim Universal Credit, SMI is included as part of your housing costs element — you provide your mortgage details through your online UC account in the "housing" section. You need your mortgage lender's name, your mortgage account number, the outstanding balance, and the monthly interest payment. If you claim Pension Credit, Income Support, JSA, or ESA, you apply for SMI by contacting the DWP office that handles your benefit — you can call or write to them. You will need to provide: proof of your mortgage (a recent statement from your lender), details of your property ownership (title register from HM Land Registry), and your mortgage account number and outstanding balance. For Pension Credit claimants, the 3-month qualifying period applies — SMI starts from the 4th month of your benefit claim. For Universal Credit claimants, the waiting period can be up to 3 months (or 9 months for pre-April 2018 claims). If you are a homeowner on benefits for the first time, apply as soon as your qualifying benefit is approved to start the waiting period. SMI cannot be backdated beyond the date you reported your mortgage costs. Once approved, the DWP will register a charge on your property at HM Land Registry for SMI loans made after April 2018. If you are unsure about the process, contact Citizens Advice or a welfare rights adviser.

What Happens When Your Circumstances Change

You must report any changes in your circumstances to the DWP immediately because they affect your SMI entitlement. Key changes include: moving home — your SMI must be recalculated for the new property; remortgaging — your SMI amount may change based on the new loan terms; your mortgage ending (full repayment) — SMI stops; your qualifying benefit stopping — SMI continues for 4 weeks after your benefit ends, then stops; your mortgage interest rate changing — the DWP uses their standard rate, not your actual rate, so this does not affect SMI; the death of your partner — the surviving partner may need to reclaim SMI in their own name; and going into hospital or care — your qualifying benefit may be affected, which in turn affects SMI. If you start work or increase your earnings, your Universal Credit may reduce but SMI can continue as long as you still qualify for the housing costs element. If your capital or savings increase above £16,000, you will lose your qualifying benefit and therefore SMI. The SMI loan (for post-April 2018 claimants) must be repaid when: you sell your home, you die (recovered from your estate), you transfer ownership of the property, or the property is repossessed. You can also repay the loan voluntarily at any time without penalty. See our Benefit Cap guide → for how the cap might affect your total benefits including housing support.

SMI Loans vs Direct Payments

Since April 2018, most new SMI claimants receive their support as a secured loan rather than a direct benefit payment. This is a critical distinction. Under the direct payment system (for those who claimed before April 2018 or who get Pension Credit without the loan rules), SMI is paid as a non-repayable benefit — you never have to pay it back. Under the loan system, the DWP registers a charge on your property and the loan accrues interest at the same rate as your mortgage. The loan (plus accrued interest) is repaid when you sell your home, or it is recovered from your estate when you die. The loan is secured, meaning it takes priority over other debts (except the original mortgage). If you are on Pension Credit, SMI is still provided as a direct payment rather than a loan — this is a key advantage for pension-age homeowners. For Universal Credit claimants, SMI is always a loan. The total loan amount (including accrued interest) cannot exceed the value of your property. If your property value is less than the total debt, the DWP writes off the remaining balance. The SMI loan scheme means that SMI effectively defers your mortgage interest costs rather than writing them off — but it can be invaluable for keeping your home while you are unable to work. The loan does not appear on your personal credit file and does not affect your ability to get credit. Always get independent financial advice before agreeing to an SMI loan, as it reduces the equity in your home. See our Mortgage guide → for more on mortgage options.

FAQs

Does SMI cover my full mortgage payment?

No — SMI only covers the interest portion of your mortgage, not the capital repayment. If you have a repayment mortgage, you will still need to pay the capital element yourself. For interest-only mortgages, SMI covers the full monthly interest.

Do I have to pay SMI back?

If you claimed SMI after April 2018 (or are on Universal Credit), yes — it is a loan secured against your home, repayable when you sell, die, or transfer the property. If you claimed before April 2018 or are on Pension Credit, SMI is a non-repayable benefit.

How long do I have to wait for SMI to start?

There is a 3-month qualifying period for most benefits (9 months for Universal Credit if you claimed before April 2018). SMI payments start from the 4th month (or 10th month) of your benefit claim. The waiting period cannot be backdated.

Can I get SMI if I am on Universal Credit?

Yes — SMI is included in the housing costs element of Universal Credit. You must report your mortgage details in your online UC account. The SMI is paid as a loan directly to your lender, not as cash to you.

What is the maximum mortgage amount covered by SMI?

The maximum loan amount covered is £200,000 for most claimants and £100,000 for Pension Credit claimants. If your mortgage is higher than this, SMI only covers interest up to the limit. You are responsible for the remainder.