Mortgage Arrears – What Should I do if my Mortgage is in arrears in Australia?

If your mortgage is in arrears in Australia, it’s crucial to address the situation promptly to prevent potential repossession of your property. Here are some steps you can take:

  1. Understand the situation: Check your credit file and mortgage documents and correspondence from your lender to understand the extent of your mortgage arrears and any penalties or fees involved.
  2. Communicate with your lender: Reach out to your lender as soon as possible to discuss the situation. They may be able to provide options to help you get back on track with your payments.
  3. Consider financial hardship assistance: Many Australian lenders have financial hardship provisions that may help borrowers facing financial difficulties. Contact your lender to see if you are eligible for any such arrangements, such as a temporary payment reduction, interest-only payments, or a payment holiday.
  4. Review your budget: Assess your current financial situation and create a budget to determine where you can cut expenses to prioritize your mortgage repayments. It may be necessary to make some lifestyle changes in order to regain control over your finances.
  5. Seek professional advice: Consider contacting a financial counselor or a licensed debt specialist to discuss your options. In Australia, you can access free financial counseling through the National Debt Helpline at 1800 007 007.
  6. Explore assistance available: Investigate if you are able to utilise your Superannuation or are eligible for any government assistance programs, such as Centrelink benefits, to help you manage your financial situation.
  7. Refinance or restructure your loan: Depending on your circumstances, you may be able to refinance your mortgage with a non conforming lender, or work with your current lender to restructure your loan. This could include extending the term of the loan or negotiating a lower interest rate.
  8. Consider selling your property: If you are unable to resolve your mortgage arrears, it may be necessary to consider selling your property to repay the debt. This is usually a last resort, but it can help you avoid repossession and potential legal action by your lender.

Mortgage Arrears

Remember, the sooner you address your mortgage arrears, the better your chances of finding a solution and avoiding more serious consequences. Reach out to your lender and seek professional advice to explore your options.