Managing Mortgage Stress
For many Australians paying off their home loan is the pot of gold at the end of the rainbow. In most cases people are able meet their regular payments and have no problems.
Sometimes however, life throws curveballs and you can find yourself in a situation where you are struggling to pay your bills. It might be from something as simple as unexpectedly high bills, or something as major as losing your job, an illness, or the loss of a family member.
To give yourself the best chance of surviving a financial setback, making sure you have a workable budget in place and a sufficient savings fund to see you through most hurdles is the ideal foundation. Some experts say you should have enough savings to cover at least three months of your regular expenses, while others recommend a minimum of six months.
Having some sort of insurance in place to protect your income may help. If you would like to know more about this contact us and we will put you in touch with one of our associates who can help you.
If your situation is looking as if it will be tight for some time, consider consolidating your debts into one lower monthly payment. This may assist you in meeting your commitments as well as put some aside to build up a savings buffer.
Some mortgage products offer what is called a repayment holiday. This is great for times such as being on maternity leave or other short periods where your income is reduced. If you want to find out if your loan has this option, contact us and we can help you.
In those cases where genuine hardship occurs, most lenders are reasonably understanding and have policies in place to help you in times of need. This can include reducing the loan to interest only or perhaps they will allow you to miss a payment and make it up over a few months. Another option sometimes available is capping the interest repayments onto the loan, although this is usually a last resort as it will in turn increase your loan balance. Again, these options are for genuine cases and will be put in place for the short term only.
If you want to know more about protecting yourself or you are having trouble, get in touch and we can point you in the right direction.