Tips to Help Ease Your Mortgage Stress

Changes in the property market, increases in the costs of living and rising interest rates can all contribute toward mortgage stress. Here are practical steps you can take today to ease the pressure.

Review your budget

Start by taking a close look at your income and expenses. Identify areas where you can reduce spending, even temporarily. Small savings across multiple categories can add up to meaningful relief. There are many free budgeting tools available that can help you track your spending and find opportunities to save.

Talk to your lender or broker

If you are struggling with repayments, don't wait until you fall behind. Contact your lender or mortgage broker early. Many lenders have hardship provisions that can provide temporary relief, such as reduced repayments, payment holidays or loan restructuring. A broker can also help you explore refinancing options that might lower your rate.

Consider refinancing

If your current loan rate is higher than what is available in the market, refinancing could save you hundreds of dollars per month. A mortgage broker can compare your current deal against options from a wide panel of lenders and help you understand whether switching makes financial sense after factoring in any exit fees or establishment costs.

Use your offset account

If your loan has an offset account, make sure you are using it effectively. Keeping your savings in an offset account reduces the interest charged on your loan without locking your money away. Every dollar in your offset works to reduce your interest bill.

Seek professional support

Mortgage stress can affect your wellbeing as well as your finances. Don't hesitate to seek support from a financial counsellor (available free through the National Debt Helpline) or speak with your mortgage broker about your options. There is always a path forward, and getting professional advice early gives you the best chance of a positive outcome.