Universal Credit and other benefit claimants will be able to access mortgage support sooner from today.
The change means thousands more people can access a Support for Mortgage Interest (SMI) loan after three months of claiming benefits, rather than nine.
Alongside this, the support will be offered "automatically" after three months of claiming.
The change means you do not need to apply for the help going forward, the Department for Work and Pensions (DWP) will come to you.
SMI support will now be offered to those who are both working and unemployed as well.
Households will also be able to re-claim the support if they leave Universal Credit but return within six months.
The DWP says the scheme will now help a further 200,000 people with the rising cost of housing.
The changes were originally announced in the Autumn Statement last year by Chancellor Jeremy Hunt.
SMI - sometimes known as "help with housing costs" - provides homeowners with money to help with interest payments on their mortgages, or on loans that have been taken out for repairs for their home.
The money is designed to help with the interest payments on your mortgage or loan.
It cannot be used towards the amount you borrowed, anything towards insurance policies you have, or missed mortgage payments.
The cash paid under this scheme is a loan and it is paid directly to your lender.
So you will need to repay this with interest when you sell or transfer ownership of your home.
If you qualify for it, you’ll usually get help paying the interest on up to £200,000 of your loan or mortgage.
However, you can only get up to £100,000 in some instances, such as if you're claiming Pension Credit.
According to Gov.uk, the interest rate used to calculate the amount of SMI you’ll get is 2.09%.
The interest rate for the amount you pay back is sat at 3.03%.
The DWP does warn that there is no guarantee that you’ll get SMI for a mortgage or loan you take out.
To be eligible you will usually need to be getting one of the following qualifying benefits:
- Income Support
- income-based Jobseeker’s Allowance (JSA)
- income-related Employment and Support Allowance (ESA)
- Universal Credit
- Pension Credit
Mims Davies, minister for Social Mobility, Youth and Progression, said: "The fear of losing your home when you have fallen on difficult times is incredibly stressful and makes getting back on your feet all the more difficult.
"This increased support is an important lifeline to help provide stability for those who are seeking to find work and move back towards long-term prosperity."
The cost of housing has become a hot topic over the last year due to the Bank of England hiking interest rates in an attempt to curb inflation.
The Bank of England base rate is now at 4.25% which has caused mortgages and rent payments to increase tenfold over the last year.
