Below we have listed the main causes of mortgage-related arrears and financial difficulty
There are many reasons people find themselves with mortgage arrears or default. Many of these reasons are listed below and all of them will increase the risk of finding yourself in arrears with your home loan. There are other factors that increase the incidence of mortgage default too, such as the capacity to pay (diminishing an ability to meet commitments such as with gambling issues) along with loan type, interest rate and other factors. Our point is, this is a list of the most common issues that cause mortgage arrears.
Studies by the RBA (Reserve Bank of Australia) have highlighted contributing factors within loan products or approvals that also contribute to home loans going in to arrears or default. They are listed below.
The factors above are important to understand as they assist in analysing the background reasons for home loan arrears. They can also prevent home loan defaults from occurring. On their own, the reasons are simply nice facts. However, when included in the mortgage arrears assessment, they provide an effective snapshot to help create a complete debt or mortgage arrears solution. It is likely that one or more of the above points applies to any mortgage arrears case. It is where the problem starts, and where it must be solved.
If you have got behind on your home loan, then contact us for mortgage arrears advice today.