Part I Claims for and Payments and General Administration of Benefit

F16 Payments in respect of mortgage interest, etc.

Annotations:
Amendments (Textual)
F16

S. 13A and cross-heading inserted (retrospective to 1.7.1992) by S.I. 1992/1309 (N.I. 9), art. 3(2), Sch. para. 1

F113A Payment out of benefit of sums in respect of mortgage interest, etc.

1

This section applies in relation to cases where—

a

mortgage interest is payable to a qualifying lender by a person (“the borrower”) who is entitled, or whose partner, former partner or qualifying associate is entitled, to income support F2or an income-based jobseeker’s allowance; and

b

a sum in respect of that mortgage interest is or was brought into account in determining the applicable amount for the purposes of income support F2or an income-based jobseeker’s allowance in the case of the borrower or the partner, former partner or qualifying associate;

and any reference in this section to “the relevant beneficiary” is a reference to the person whose applicable amount for the purposes of income support F2or an income-based jobseeker’s allowance is or was determined as mentioned in paragraph (b) above.

F31A

This section also applies in relation to cases where—

a

mortgage interest is payable to a qualifying lender by a person (also referred to as “the borrower”) who is entitled, or whose partner, former partner or qualifying associate is entitled, to state pension credit; and

b

a sum in respect of that mortgage interest is or was brought into account in determining the appropriate minimum guarantee for the purposes of state pension credit in the case of the borrower or the partner, former partner or qualifying associate;

and any reference in this section to “the relevant beneficiary” includes a reference to the person whose appropriate minimum guarantee for the purposes of state pension credit is or was determined as mentioned in paragraph (b) above.

2

Without prejudice to paragraphs (j) and (q) of section 5(1) above, regulations may, in relation to cases where this section applies, make provision—

a

requiring that, in prescribed circumstances, a prescribed part of any relevant benefits F4(other than state pension credit) to which the relevant beneficiary is entitled shall be paid by the Department directly to the qualifying lender and applied by that lender towards the discharge of the liability in respect of the mortgage interest;

F5aa

authorising or requiring that, in prescribed circumstances, a prescribed part of any state pension credit to which the relevant beneficiary is entitled may (or, as the case may be, shall) be paid by the Department directly to the qualifying lender and shall be applied by that lender towards the discharge of the liability in respect of the mortgage interest;

b

for the expenses of the Department in administering the making of payments under the regulations to be defrayed, in whole or in part, at the expense of qualifying lenders, whether by requiring them to pay prescribed fees or by deducting and retaining a prescribed part of the payments that would otherwise be made to them under the regulations or by such other method as may be prescribed;

c

for requiring a qualifying lender, in a case where by virtue of paragraph (b) above the amount of the payment made to him under the regulations is less than it would otherwise have been, to credit against the liability in respect of the mortgage interest (in addition to the payment actually made) an amount equal to the difference between—

i

the payment that would have been so made, apart from paragraph (b) above; and

ii

the payment actually made;

and, in any such case, for treating the amount so credited as properly paid on account of benefit due to the relevant beneficiary;

d

for enabling a body which, or person who, would otherwise be a qualifying lender to elect not to be regarded as such for the purposes of this section, other than this paragraph;

e

for the recovery from any body or person—

i

of any sums paid to that body or person by way of payment under the regulations that ought not to have been so paid; or

ii

of any fees or other sums due from that body or person by virtue of paragraph (b) above;

f

for cases where the same person is the borrower in relation to mortgage interest payable in respect of two or more different loans; and

g

for any person of a prescribed class or description who would otherwise be regarded for the purposes of this section as the borrower in relation to any mortgage interest not to be so regarded, except for the purposes of this paragraph;

but the Department shall not make any regulations under paragraph (b) above unless it has consulted with such organisations representing qualifying lenders likely to be affected by the regulations as it considers appropriate.

3

The bodies and persons who are “qualifying lenders” for the purposes of this section are—

F6a

a deposit taker;

b

F7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F8c

an insurer;

d

any district council;

e

the Housing Executive;

and such bodies or persons not falling within paragraphs (a) to (e) above as may be prescribed.

4

In this section—

  • F9“deposit taker” means—

    1. a

      a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to accept deposits, or

    2. b

      an EEA firm of the kind mentioned in paragraph 5(b) of Schedule 3 to that Act which has permission under paragraph 15 of that Schedule (as a result ofqualifying for authorisation under paragraph 12 of that Schedule) to accept deposits;

  • “insurer” means—

    1. a

      a person who has permission under Part 4 of the Financial Services and Markets Act 2000 to effect or carry out contracts of insurance, or

    2. b

      an EEA firm of the kind mentioned in paragraph 5(d) of Schedule 3 to that Act which has permission under paragraph 15 of that Schedule (as a result ofqualifying for authorisation under paragraph 12 of that Schedule) to effect or carry out contracts of insurance;

  • F10“appropriate minimum guarantee” has the meaning given by section 2(3) of the State Pension Credit Act (Northern Ireland) 2002;

  • “mortgage interest” means interest on a loan which is secured by a mortgage of or charge over land and which has been taken out to defray money applied for any of the following purposes, that is to say—

    1. a

      acquiring any residential land which was intended, at the time of the acquisition, for occupation by the borrower as his home;

    2. b

      carrying out repairs or improvements to any residential land which was intended, at the time of taking out the loan, for occupation by the borrower as his home;

    3. c

      paying off another loan; or

    4. d

      any prescribed purpose not falling within paragraphs (a) to (c) above;

    but interest shall be regarded as mortgage interest by virtue of paragraph (c) above only to the extent that interest on that other loan would have been regarded as mortgage interest for the purposes of this section had the loan not been paid off;

  • “partner” means—

    1. a

      any person F17who is married to, or a civil partner of, the borrower and who is a member of the same household as the borrower; or

    2. b

      any person F18who is neither married to, nor a civil partner of, the borrower but who lives together with the borrower as husband and wife or as if they were civil partners , otherwise than in prescribed circumstances;

    and “former partner” means a person who has at some time been, but no longer is, the borrower’s partner;

  • “qualifying associate”, in relation to the borrower, means a person who, for the purposes of income support F11, an income-based jobseeker’s allowance or state pension credit, falls to be treated by regulations under Part VII of the Contributions and Benefits Act F12, the Jobseekers (Northern Ireland) Order 1995 or the State Pension Credit Act (Northern Ireland) 2002, as the case may be, as responsible for so much of the expenditure which relates to housing costs (within the meaning of those regulations) as consists of any of the mortgage interest payable by the borrower, and who falls to be so treated because—

    1. a

      the borrower is not meeting those costs, so that the person has to meet them if he is to continue to live in the dwelling occupied as his home; and

    2. b

      the person is one whom it is reasonable, in the circumstances, to treat as liable to meet those costs;

  • “relevant benefits” means such of the following benefits as may be prescribed, namely—

    1. a

      benefits, as defined in section 121 of the Contributions and Benefits Act ;

    2. aa

      F13a jobseeker’s allowance;

    3. b

      income support;

    4. c

      F14state pension credit;

  • “residential land” means any land which consists of or includes a dwelling.

F154A

The definitions of “deposit taker” and “insurer” in subsection (4) must be read with—

a

section 22 of the Financial Services and Markets Act 2000;

b

any relevant order under that section; and

c

Schedule 2 to that Act.

F194B

For the purposes of this section, two people of the same sex are to be regarded as living together as if they were civil partners if, but only if, they would be regarded as living together as husband and wife were they instead two people of the opposite sex.

5

For the purposes of this section, regulations may make provision—

a

as to circumstances in which residential land is or is not to be treated as intended for occupation by the borrower as his home; or

b

as to circumstances in which persons are to be treated as being or not being members of the same household.