Back just a few short months ago COVID-19 felt like something that was happening overseas and we continued going about our normal routine. As we come out on the other side of March 2020, there is now no doubt, that this year has brought with it significant challenges for both households and businesses.
Our financial institutions are now needing to make lending changes and provisions to rapidly deal with the economic issues that Australians are facing.
With a number of industries effectively shut down due to the federal and state restrictions in place the flow-on effects are being felt. With employment being impacted incomes to service loans are becoming a concern for many Australians.
The good news is that the Government has responded relatively quickly in looking to do all that it can to secure people’s jobs as we ride out this crisis over the next six months or more.
While we won’t go into great detail here on the options available to you, as your accountant would be best positioned to provide you advice on this, we’ve provided a summary below of the main support that is being made available to individuals and you should keep up to date via the Treasury website.
Business owners – there is a range of other payments that business owners may be eligible for including a Boosting Cash Flow for Employers measure, support for apprentices and trainees as well as temporary relief for financially distressed businesses to name a few.
If you have lost your job or had a significant decrease in your income and qualify for the above options, you may still be in a position to service your home loan.
In this instance, we would suggest you speak to us as your mortgage broker to consider whether restructuring your loans and ensuring you are on the best interest rate for your needs will be of benefit to you.
This may result in a reduction in your regular repayments and help to give you some level of relief. We are in an incredibly low-interest rate environment at the moment, so you want to ensure you aren’t paying more than you need to be.
It is also a great time to consider refinancing your loan, as there are a considerable amount of low rate offers available from many financial institutions. By refinancing your loan, you could slash a considerable amount off your repayments and interest rates.
Contact me today to discover the best refinancing deals currently available in the market.
We know, however, for some Australians that with no income they simply won’t be able to keep up with their mortgage repayments. The banks are aware of this too and have always had hardship provisions in place for similar circumstances.
The COVID-19 impact has seen the banks and other lending institutions share their hardship policies and provisions and most of them are offering deferred home loan repayment options as well as a range of provisions for their business customers.
Different banks have different conditions upon which they’ll grant an exemption with some being more relaxed with their procedures and others taking things on a case-by-case basis to determine eligibility.
We will cover off in this article how the big 4 banks are responding to the COVID-19 crisis, but If your bank’s details are not listed here and you need some assistance with finding out the hardship provisions for your loan, please do not hesitate to get in touch with me.
More information is available here: https://www.anz.com.au/support/covid-19/
More information is available here: https://www.commbank.com.au/latest/coronavirus.html
More information is available here: https://www.nab.com.au/personal/customer-support/covid19-help/home-owners-support
More information is available here: https://www.westpac.com.au/help/disaster-relief/coronavirus/
With all of these hardship measures, you will need to show you have lost your job or had a reduction in your income. We encourage you to speak with your financial institution in advance before you default on your loan. To work out the best solution for your unique circumstances.
As your broker, we can help guide you through your options when it comes to restructuring your loans or discussing if taking advantage of the hardship option from your bank might be the best course of action for you.
Book your free 15-minute discovery session today and let’s get you on track to ride out the crisis and come out stronger on the other side.