Mortgage assistance service now available across Victoria

Mortgage Stress Victoria (MSV) is a free, government-funded support service for people struggling with their home loan repayments.

Financial counsellors, specialist lawyers, and social workers are available to help eligible borrowers through the service.

It was initially trialed in Melbourne's western suburbs and the Victorian Government says it's helped prevent more than 190 home repossessions since 2022.

State Attorney-General Jaclyn Symes announced it will be made available to struggling homeowners throughout Victoria on Wednesday.

"Mortgage Stress Victoria offers more than just financial advice – it's a lifeline for people's wellbeing, their future, and their peace of mind," she said.

"We are supporting more vulnerable Victorians to stay in their home."

While mortgage stress is subjective, its common definition is when home loan repayments are more than a certain proportion of a borrower's after-tax income – often around 30%.

Research from Roy Morgan found 26.2% of mortgage holders in Australia were at risk of mortgage stress over the twelve months to October.

About 16.4% were deemed 'extremely at risk'.

These numbers are actually lower than they were earlier this year and over much of 2023, but remain significantly higher than the preceding decade.

Who can get help?

Any Victorian resident who owns the mortgaged property they live in, no other properties, and has a household income of $75,000 or less can access the MSV service.

Those affected by domestic violence can also access the service, with about a third of clients so far being family violence victim-survivors.

It's also available to Victorians in various circumstances – whether they're yet to miss a repayment or a court has ordered the repossession of their home.

MSV financial counsellors might be able to negotiate a new, affordable repayment schedule while lawyers protect a homeowner's rights.

Victorians can get in touch with the service by calling 1800 572 292 from 9.30am to 5pm, Monday to Friday, or by filling out an online form.

For those struggling who don't qualify or who live outside of Victoria, existing free financial counselling services include:

If mortgage stress is affecting your mental health, you can also reach out to the likes of Beyond Blue.

Any interest rate relief in sight?

The RBA board delivered a widely-expected hold in its final monetary policy decision of the year on Tuesday.

The cash rate will remain at 4.35% until at least 18 February.

CommBank economists are officially predicting the RBA's February meeting will result in a rate cut, but the three remaining big four banks believe May is more likely to bring the first cut.

Mortgage holders counting down the days might take solace in what NAB head of market economics Tapas Strickland called a "dovish pivot" in RBA rhetoric.

He said it was important the RBA is "gaining some confidence" in the inflation path, as per the post-meeting statement.

"Growing confidence in the inflation forecast is important as it lessens the probability of the RBA needing to hold rates for even longer," he said.

"NAB's view has been that the RBA would cut rates in May but with the risks skewing later.

"With the RBA's confidence having grown, the risks are now clearly more balanced."

Picture from Urlaub Stracker on Unsplash

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