§ Mr. Jim CunninghamTo ask the Chancellor of the Exchequer how many people will face larger mortgage statements at the end of this month following the Government's decision to reduce mortgage interest relief to 20 per cent.
§ Mr. DorrellThere are about 10 million single people or married couples with mortgages. Not all of them will make larger interest payments straight away as a result of the restriction of mortgage interest relief to 20 per cent. This is because some mortgages are subject to annual reviews and these may take place at different times of year. Lenders may apply the new rate of relief, and make any necessary adjustments, then.
In addition, some 200,000 borrowers receiving tax relief have loans that are not in the MIRAS—mortgage interest relief at source—scheme. For them, the restriction of relief has no effect on their interest payments, but will be made through their PAYE coding or in an annual assessment.
The number of borrowers with annual review mortgages is not known: a precise answer to the question is therefore not available.