COVID-19 And Your Debt

The coronavirus has affected the financial situation of thousands of people in Australia. Here are the best moves to protect your finances.

What are some decisions to make in this time of uncertainty and crisis, to alleviate some of the financial pressure caused by your lending?

In the past few weeks, many of our fellow Australians have lost their jobs, have been stood down or are on unpaid leave, or have had their employers close down temporarily or permanently. Equally, small businesses and business owners are also facing a crisis.

COVID-19 has brought about an express recession and crisis in our country, with great uncertainty for the future. It has left countless families and individuals with limited financial means to meet their debt commitments.

Without a stable income, many are finding it difficult to survive, asking themselves: How am I going to fund my mortgage? Pay my credit card loans? Manage my living expenses?

Fortunately, for the benefit of everyone, banks, lenders, and the government have taken some steps to lighten the financial burden for Australians.

Here is a brief guide of the steps to take to alleviate the financial pressures caused by COVID-19:

  1. Contact your lender or mortgage broker immediately for assistance and advice. You can request your mortgage broker to request the lender to change your loan payment terms from Principal and Interest to Interest-only for a period of time. This may help reduce your minimum monthly commitment and financial stress in the short term.
  2. Contact your bank or lender and explain your circumstances and request to reduce your loan repayment for the next few months. Your bank may be willing to assist you in this difficult time. You must ensure that there will be no impact on your credit file and must ask them if there will be any such impact.
  3. If your financial situation means that you cannot make any loan repayment, you must contact your lender and apply for hardship.  You must ensure that there is no impact on your credit file.
  4. If you have permanent and stable employment and require a safety net or buffer to weather this storm, you may be able to refinance. 

In times of crisis, we must remember to be together and keep in mind that compassion is our greatest weapon.

Stay safe and contact us any time for more in-depth advice on how to stay financially healthy during these tough times.

At your service, Home Loan Mentors.

Disclaimers: Terms and conditions apply. Fees and charges may apply. Subject to lending criteria of the lender. This information has been prepared without taking into account your circumstances and needs, and may not be suitable for your circumstances.

Home Loan Mentors:
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