Circumstances beyond your control may be causing you now to stress over making home loan repayments. Act now to help you avoid foreclosure.
If you have lost your job or been sick and missed work, or been injured, you may be struggling to make repayments on your mortgage. There are a number of things that you need to consider and actions you need to take to ensure that you are able to maintain the roof over your head. Looking at your situation sooner rather than later will help you avoid defaulting and lead you to have a better overall outcome, and a reduction in personal stress.
Be aware of your finances and ability to make mortgage repayments
The first thing upon having had a situation like being laid off from your job or being injured or sick is to be aware of your finances coming in, and how much you are currently having being spent on outgoings. With finances coming into the household – are you able to access alternative sources of income such as sickness payment, unemployment benefits or disability payments – whether short or long term. Go through your paperwork and see if you have previously obtained insurance to cover things such as unemployment or disability to pay your mortgage payments while you are in this situation.
Once you are aware of what payments are available to support your income, it is important to establish a budget as to how much you can afford to spend on your essentials, and how much you can afford to repay on your loan. As a general rule, you should be not spending any more than 50 – 60% of your income on your mortgage repayments.
Get help and information relevant to your situation
You may need assistance from a welfare organization, social security advisor, a social worker, or a financial counselor to help you organize your finances so that you can cover your essential living expenses. They can provide you with information where you can access social security payments, food assistance, medical assistance, or mortgage assistance.
Understand your rights
Professionals such as financial counselors can help you negotiate with your lenders to vary your payments or set aside your payments temporarily, depending on what your mortgage contract is or what your legal rights are. They can help you go through the fine print in your mortgage contract, and are aware of all of the rights that you have in your particular jurisdiction.
You can be entitled in Australia to apply for a hardship variation – where you are able to vary the terms of your mortgage repayments – because you are in a situation where unforeseen circumstances occurred.