1. CONTACT YOUR BANK OR LENDER
The first, and most immediate way to deal with mortgage arrears is to contact your bank. Having a good relationship with your bank is key, as is open and honest communication. Your bank does not want to lose you as a customer. If your payment history has been consistent and on time, the bank will negotiate a payment option that works for both of you and should be able to do this pretty quickly. If there has been a history of non-payment or arrears, it might be a slightly more lengthy process with a more stringent commitment, but again, the bank will always want to work to save you as a customer. The solutions will vary depending on how far in arrears you are but as with most things, it is advisable to contact the bank sooner rather than later. A small problem left alone now, can grow into a much bigger problem down the line.
2. CONFRONT THE ISSUE THAT CAUSED THE ARREARS
The second thing to do is to deal with why you got into arrears in the first place. If it was a Christmas over-spend, obviously the solution is clear; tighten your belt during the year and save towards a luxe Christmas or cut your spending over the holidays in future. In the situation of a loss of employment, then it becomes a little harder. If you are off work due to illness or injury and you have insurance, it would be advisable to investigate this as an option, to avoid future arrears or worse. Gainful employment is necessary to be approved for a mortgage and likewise, needed to sustain the payments. If you have lost your job and you have mortgage commitments, then finding a new job should be your first and most urgent task. If you are in arrears due to a personal situation, the banks will handle it on a case by case basis but don’t ever be afraid to call and find out your options.
3. APPLY FOR FINANCIAL HARDSHIP
If you are likely to be without income for some time, do not worry, there is a financial hardship application that can be made under section 72 of the National Consumer Credit Protection Act of 2009 that provides hardship protection to the consumer. In order to qualify for this, you need to provide a written or verbal hardship notice to your bank/credit provider. The lending institution has 21 days to request more information and you have 21 days from that request to provide the information required. If your notice is accepted, a workable payment solution will be entered into and obligations must be met from that point on. Legal Aid NSW describes the arrangement well; “The aim is to make a repayment arrangement that is affordable and sustainable. It is essential to propose a repayment arrangement that will work.” The resolution needs to work for you both so the process should be one of negotiation and compromise. There will requirements to provide paperwork and supporting documentation, depending on your notice and if these are provided within the time frame allowed and the case is accepted, a solution will be presented.
4. SEEK HELP FROM A CREDIT MEDIATION EXPERT
A lot of this can seem very daunting and you might worry that you don’t know where to start, what to say or what to ask for. If this is you, then this fourth solution may well be the one to choose. Contacting a credit negotiating specialist/credit mediation service might be the best thing you ever do in terms of gaining control back over your mortgage or any other financial obligations you may be struggling with. A credit mediator will contact your bank/lenders and negotiate on your behalf, taking the stress out of the whole experience. They know who to call and what to say to get your debt reduced to a more manageable level.
Laurence, at Credit Mediation Services is an expert in his field, having helped so many Australians regain control over their debt. In 24 hours, your case will be reviewed and qualified and within 3 weeks, your debt could be reduced by more than half. Credit Mediation Services offer a no win, no pay policy so there really is nothing to lose.
Please connect with me if you’d like me to co-ordinate an obligation free chat with Laurence. Your financial future is important and having a credit mediator in your corner is a smart step towards ensuring that you don’t run into financial trouble again.
Cairns Mortgage Broker – Jason Thomson is a Mortgage Adviser and Finance Broker based in Cairns with clients all around Australia. Client reviews featured on his website prove that Jason is a trusted industry professional, facilitating great outcomes for his clients. Using his wealth of experience in financial services, he thrives on delivering superior service. Jason is very approachable and is always looking for new clients to help in the often confusing world of finance and property. Offering a no fee service, you’ve got nothing to lose by having an obligation free chat with Jason today.