The Chancellor has largely left mortgages alone in recent budgets, but last week he came out fighting.
Mr Osborne said: “Buy-to-let landlords have a huge advantage in the market as they can offset their mortgage interest payments against their income, whereas homebuyers cannot. And the better off the landlord, the more tax relief they get. For the wealthiest, for every £1 of mortgage interest cost they incur, they get 45p back from the taxpayer.”
The Chancellor highlights this as a contribution to the rapid growth in buy-to-let properties, which now account for over 20% of the mortgages we arrange at Mortgage Required. The Bank of England warned us last week could pose a risk to our financial stability. Personally, I think it’s the lack of pensions we can all look forward to which has spurred the growth in this sector.
Mortgage interest relief will still remain, but we will be restricted to the basic rate of income tax. The withdrawal of the higher rate of relief will be phased in over a four-year period and only starts in April 2017.”
The other dramatic change is the basis on which “Support for Mortgage Interest” payments will be made.
Currently, homeowners receiving certain income-related benefits can get a portion of their mortgage interest paid by the government. As part of the Chancellor’s Welfare cuts, he announced in his budget that this payment will in future come in the form of a loan.
The message for me, is that it is now more important than ever to make sure your mortgage is protected. If you can’t pay it, this government won’t!
Recent posts
The chancellor will deliver her second budget this autumn. Due to slow economic growth and high inflation, the government need to manage a £40 billion shortfall in public finances. There have already been reports about changes to taxes including income tax and capital gains tax.
Landlords could face a new tax this autumn
12 days ago
The chancellor has advised that landlords could have another tax to pay this autumn as the Treasury decide whether to extend national insurance contributions to rental income.
According to a report in the Guardian, senior ministers have asked Treasury officials to look into a “proportional” property tax to see how it would work as an alternative to the existing stamp duty land tax on owner-occupied homes.
More than a quarter of UK adults in long-term relationships (26%) have reported that despite living together, they keep their finances separate from one another.
There has been a rise in both rent and mortgage costs over the last three years, with renters seeing a greater increase in their monthly payments than those with a mortgaged property.
Delayed Start Mortgages
6 Aug 2025
The new Delayed Start Mortgage launched by Skipton Building Society allows first time buyers to postpone the first three mortgage payments. This product has been designed to help soften the blow of moving in costs for first time buyers.
Green Mortgages | Rewards and Benefits
4 Aug 2025
Mortgage lenders are starting to recognise their “Green” responsibilities when it comes to the different products they offer.
A recent study by Boon Brokers where 1,000 people who had used an estate agent over the last year were surveyed, showed that a whopping 52% said they were pressured into using the estate agents’ in-house mortgage broker.
More information
Trusted by
