ASIC | September 1, 2011

ASIC has launched new resources and tools on its consumer finance website www.moneysmart.gov.au to help people avoid mortgage stress.

Delia Rickard ASIC Senior Executive Leader Financial Literacy, Consumers, Advisers, Retail Investors said: ‘From time to time some people find themselves struggling to pay their mortgage as well as juggling debts. Financial issues are often triggered by a change in circumstances such as illness, losing employment or divorce.

‘We know a small number of Australians are in arrears on their mortgage. However, many more struggle to make their mortgage repayments on time, and can only do so by running up other debt. We want to educate people about the signs of mortgage stress and motivate them to take early action.1′

ASIC is holding a Mortgage Health Month in September and is encouraging everyone to do the online Mortgage Health Check on the MoneySmart website. The Health Check tells people where they are at with their mortgage and gives them practical steps to take if they have any mortgage issues.

ASIC’s mortgage health tools on www.moneysmart.gov.au also include:

  • video clips of real people explaining how they have dealt with mortgage stress
  • guidance for people in every type of mortgage situation
  • sample letters for people to send their lender if they are in financial hardship
  • the mortgage switching calculator to help people see if switching is an option, and
  • video clips explaining how financial counsellors and legal services can help.

Ms Rickard said: ‘If there are signs you may have trouble with your mortgage, take action straight away to get back on track. If you don’t feel in control of your money then use the MoneySmart budget planner. If you are in danger of missing a mortgage repayment, speak to your lender about changing your repayments or your loan term.

‘If your situation is more serious, or you can’t work things out with your lender, you should seek help from a free financial counsellor, a free legal service or an external dispute resolution scheme. The MoneySmart website can help you locate the best service for you.

‘If you know a family member or friend who is struggling with their mortgage, MoneySmart also has sensible advice on how to approach them and help in a practical way,’ said Ms Rickard.

ASIC will hold events in specific geographical areas where the rate of mortgage stress is high. It will partner with local services and organisation in Fairfield and Liverpool in NSW, the Mandurah region in Western Australia and in Logan and the Gold Coast in Queensland to provide and promote specialised assistance to people at risk or experiencing mortgage stress.

ASIC will also hold briefings for banks and other lenders, to encourage them to promote the MoneySmart website to consumers who are in arrears on loan repayments.

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