dealing with mortgage stress

Organisations in the west have banded together to help people deal with mortgage stress.

A Mortgage Wellbeing Service, run by Brimbank Melton Community Legal Centre and Djerriwarrh Health Services and operating since March, views mortgage stress as a financial, legal and health problem.

BMCLC legal practice program manager Stephanie Tonkin said the “integrated” service was dealing with all aspects of mortgage stress.

“A financial counsellor and lawyer sit together and see what the client’s needs are and, where needed, they can then be referred to a social worker,” Ms Tonkin said. “Mortgage stress is more than a legal issue; it often impacts relationships, families and the client’s health.”

Mortgage stress is defined as happening whenever a household spends more than 30 per cent of its income on mortgage repayments. And, according to Census figures released in 2011, mortgage stress in Melton was 14 per cent.

Ms Tonkin said she expected this percentage to be much higher today.

“Clients take out a loan and that’s fine and dandy but, after a change in circumstances, what was manageable sometimes becomes just barely manageable and then repayment becomes impossible,” she said.

“Sometimes we hear stories about people turning to drug and alcohol use or gambling due to the financial pressure, which makes situations even worse.”

When asked, on a scale of one to 10, what clients’ stress levels were like when they found it difficult to make mortgage repayments, Ms Tonkin said many answered 10 or 11 out of 10.

She said financial difficulties could spiral out of control very quickly without early intervention. “We’re already starting to see clients early in the mortgage stress cycle, and that’s actually a really good outcome,” Ms Tonkin said.

“Having those earlier referrals means we can set these clients up. We also give a lot of training to professionals [such as health workers, local council officers, and legal service providers] around the warning signs of mortgage stress.

“The service has received funding for two years, until 2017, from the Victorian Legal Services Board and Commissioner. Although already operating, the Mortgage Wellbeing Service will be officially launched on July 26. On the same day, a forum on family finances will be held from 5-6pm at the Melton library,
31 McKenzie Street.

As well, an information session on mortgages will be held at the Caroline Springs library, 191 Caroline Springs Boulevard, on Wednesday, July 29, from 7pm-7.45pm. Details: 8312 2020.

The Mortgage Wellbeing Service is at Melton Health: 195-209 Barries Road, Melton West, and at Djerriwarrh Health Services Community Centre, corner Yuille and High streets, Melton.