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'Super-rich' claiming benefit lose help on large mortgages

Liz Hunt
Sunday 01 August 1993 23:02 BST
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PEOPLE with mortgages in excess of pounds 150,000 who claim income support because of unemployment will no longer get help with interest payments on the full loan after the first 16 weeks, writes Liz Hunt.

The Department of Social Security has introduced a ceiling of pounds 150,000 for new claims, effective from today. A new claimant who has a mortgage of pounds 200,000, for example, will not get any help on pounds 50,000 of it. The ceiling will be further reduced to pounds 125,000 next April.

The move follows a number of cases in which previously high earners fallen on hard times remained in luxurious homes with their mortgage interest payments taken care of. Last week it was revealed that the DSS was paying pounds 1,520 a month in interest payments for a woman living in a 14-bedroom castle in the Cotswolds.

'This is really aimed at the 'super- rich' sitting in their mansions, people who could have taken out insurance to protect their mortgage payments,' a DSS spokesman said yesterday.

The current restriction which limits payment of mortgage interest to 50 per cent during the first 16 weeks of a claim will also apply to people with mortgages greater than pounds 150,000.

According to the DSS, 2,000 people on income support receive help towards loans of more than pounds 150,000.

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