The Social Security (Claims and Payments) Amendment Regulations 2010

Amendment of the Social Security (Claims and Payments) Regulations 1987

2.—(1) The Social Security (Claims and Payments) Regulations 1987(1) are amended as follows.

(2) In both regulation 34A and regulation 34B (each of which deals with deductions of mortgage interest from benefit and payment to qualifying lenders)—

(a) in paragraph (1), at the end insert “or, insofar as the payment exceeds that liability, in accordance with paragraph 4A of that Schedule.”; and

(b) for paragraph (2) substitute—

“(2) The provisions of Schedule 9A shall have effect in relation to payments made under this regulation.”.

(3) In Schedule 9A (deductions of mortgage interest from benefit and payment to qualifying lenders), after paragraph 4 (direct payment: more than one loan) insert—

“Application of payment where it exceeds borrower’s actual mortgage interest

4A.— (1) Subject to sub-paragraph (2), insofar as the sum paid to a qualifying lender under this Schedule in respect of a particular loan exceeds the borrower’s liability in respect of the mortgage interest payable on that loan the excess shall be applied by that lender in the following order of priority—

(a) first, towards the discharge of any liability for arrears of mortgage interest in respect of that loan;

(b) second, towards the discharge of any liability to repay the principal sum, or any other sum payable by the borrower to that lender, in respect of that loan.

(2) Where the borrower is liable to pay mortgage interest to the same qualifying lender in respect of two or more different loans, insofar as the sum paid to that lender under this Schedule in respect of one of those loans (“loan A”) exceeds the borrower’s liability in respect of the mortgage interest payable on that loan the excess shall be applied by that lender in the following order of priority—

(a) first, towards the discharge of any liability for arrears of mortgage interest payable in respect of loan A;

(b) second, towards the discharge of any liability to repay the principal sum, or any other sum payable by the borrower to that lender, in respect of loan A or (insofar as that liability is not already discharged by the application of any other sum paid to the qualifying lender under this Schedule) any of the other loans.”.

(1)

S.I. 1987/1968. Regulation 34A was inserted by S.I. 1992/1026 and amended by S.I. 2002/3019 and 2002/3197. Regulation 34B was inserted by S.I. 2002/3197. Schedule 9A was inserted by S.I. 1992/1026 and amended by S.I. 1995/1613, 1996/672, 1996/1460, 1996/3195, 1997/827, 1997/2305, 1999/2860, 1999/3178, 2001/488, 2002/2441, 2002/3019, 2002/3197, 2004/2825, 2005/777, 2006/2378, 2007/3183, 2008/1554, 2008/2831 and 2009/583.