Keeping your mortgage on track
If you're making your mortgage repayments, but finding your
finances are pretty stretched, or if you just want to make sure you
can cover repayments in the future, there are things you can
Here we give you some tips to help you stay on top of your
Create a budget
Monitoring your spending can help you to keep up with your
mortgage repayments. How do you do this? Make a budget, stick to it
and adjust it as your financial situation changes.
Stay in control of your money and plan for your
See how to do a budget for tips on
what to do and how to get help putting your budget together.
Plan for future changes to your
Look at your mortgage repayments and test different scenarios.
How much extra would you need to pay if the interest rate goes up?
Could you afford it?
See how an interest rate change could affect your
What if you or your partner lost your job? Could you make the
mortgage repayments if that happened? Consider setting up a savings buffer that you
could draw on if you need to.
Video: Tran struggles with mortgage repayments
Mortgage help video
Tran struggles to pay his mortgage when interest rates
rise. Then he finds a financial counsellor to help him
with his money problems.
Tell your lender if you're
struggling with your mortgage
If you are struggling with your repayments, talk with your
lender about it. They must assess and respond to your request
within a set amount of time.
Get over the fear factor
Most people find it stressful and embarrassing to speak to their
lender when they are having trouble with their mortgage repayments.
Or they worry that raising the issue could have a negative impact.
But remember, getting into financial difficulty is something that
could happen to anyone. The important thing to keep in mind is that
by taking action quickly, you can stop a small problem from
becoming a big one.
Contact your lender as soon as possible if you are struggling
with your mortgage. The sooner you do this, the more options you'll
Options to discuss with your lender
If you think your problems are short-term and can be sorted out
fairly quickly, your lender can help you by changing the terms of
your loan. This is called a 'hardship variation' (see how to
apply for a hardship variation). Depending on when you took out
your loan, there are different thresholds (maximum amounts allowed)
for accessing a hardship variation (see hardship threshold).
Here are some of the options you could discuss with your
- Extend your loan period, so you make smaller repayments over a
- Postpone your repayments for an agreed period.
- Extend your loan period and postpone your
repayments for an agreed period.
- Other ways to make your loan repayments more affordable.
If your problems are long-term and your circumstances are
unlikely to change, then the lender may agree to permanently change
your repayments. Just keep in mind that this will increase the
total amount you will have to repay, as you will pay more in
interest if you choose to pay off the loan over a longer period of
If you are not happy with your lender's response you can ask to
speak to their internal complaints section.
Talk to the Ombudsman
If you are still not happy with the lender's decision, you can
lodge a dispute (for free) with your lender's external dispute resolution (EDR) scheme - either
the Financial Ombudsman Service
(FOS) 1800 367 287 or the Credit and Investments
Ombudsman (CIO) 1800 138 422.
Get help from a financial
If you are unsure what to do, or are having trouble negotiating
with your lender, you can get free, confidential help from
a financial counsellor.
Video: Tran sees a financial counsellor
Mortgage Help 2 video
Find out how a financial counsellor helps Tran when he
struggles to make his mortgage repayments.
Traps to avoid slipping
further into debt
If you're having trouble with your mortgage, some of the
following strategies might seem like the answer, but they are
rarely an instant fix and could even make your situation worse:
- Borrowing more money or using your credit
cards - If your existing loan is already becoming
unaffordable, you don't want to get yourself deeper into debt. See
- Borrowing from family and friends - While this
may work for some people, it can add to your debts plus you'll have
the social pressure of owing money to your loved ones. See loans involving
family and friends.
- Refinancing or consolidating your debts - If
you are thinking about rolling all your loans into one, know the
risks involved and watch out for hidden costs. See debt consolidation and
- Switching home loans - Although switching
loans may save you money over time, it may take you a while to
recoup the costs of switching. See switching home loans.
- Accessing your super - You can only do this in
limited circumstances. This is a last resort and should only be
considered if it will save your home. See getting
Don't struggle in silence. If you start to have
difficulty with your mortgage, approach your lender as soon as
possible to discuss changing your repayments.
Last updated: 01 Jun 2018