How to manage “Mortgage Stress”
According to research, and several reports, over a third of households will suffer from mortgage stress. We have put together some information for you to help prevent this or deal with this, if you are already there.
Home buyer stress usually arises when funds are low and we live beyond our means. Interest rates rise, we are faced with unemployment, we are met with unexpected medical expenses or the house market becomes sluggish can be some of the causes for this.
So how can we prevent mortgage stress?
PREPARE FOR THE FUTURE
No-one really knows what the future holds for us, so it always best to have an emergency fund set aside to prepare us for the unexpected, start saving as soon as you can and try to have a balance that is about 3-6 months of your income. Organising income protection insurance is one way of planning for loss of income in the event of injury or other medical reasons. We have some partners we can refer you to if you need to set this up.
SET YOURSELF A REALISTIC BUDGET
If you are always worried about how you are going to pay the mortgage, then it is very important to be aware of what you are spending every week. Write down what you need to spend weekly and compare it to the income you have and see how much you have left over. Sometimes just knowing where your money is going can help alleviate the stress you feel. It pays to check your finances on a regular basis and take control of your financial situation. Why not use our free budget calculator to look at the bigger picture? https://www.limemortgagebrokers.com.au/budgetcalculator
REDUCING YOUR EXPENSES
There are always ways to reduce your spending, have a look at where all your money is going every week and ask yourself if everything you are spending your money on is necessary or could you be making some cutbacks. Your bills are usually the best place to start. Is your phone out of contract? This is one of the more regular expenses and one we can reduce if we shop around. The gas companies are always competing, make sure you are on the best deal. Health insurance, home and car insurance, home internet, gym memberships are all things that you may be able to cut down.
Things like turning the TV off and reducing the amount of time in the shower can reduce household spending, Meal planning every week, so you don’t buy anything you don’t need. Buying things in bulk and checking out the supermarket catalogues (you will be surprised at how much you can save by comparing the necessities.)
Do you dine out or eat take away every week? Reducing these costs can add up quickly.
The good news is that there are always ways to manage mortgage stress. If you are concerned about your financial situation then make sure you act immediately. You can always contact your lender and let them know you are worried about your current situation. They may able to reconfigure your payments or allow you to take a repayment holiday.
Please feel free to get in touch with us at Lime Mortgage Brokers anytime for further information on how to deal with mortgage stress. We can also take a look at your current mortgage for you and see if there is anything we may be able to do to help you out.
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The information contained on www.limemortgagebrokers.com.au website and posts is for general information purposes only. Lime Mortgage Brokers assumes no responsibility for errors or omissions in the contents of this publication. The information we provide may not be relevant for all individual circumstances. You should always seek professional advice before you take action in relation to any of the matters in this publication.