In March 2020, banks across Australia offered their customers the option to pause their mortgage repayments in response to the massive job losses caused by COVID-19.
In June 2020, Australia experienced a peak of 800,000 deferred mortgages to the value of $195 billion. At the time, one in ten mortgages had been frozen due to financial difficulties caused by COVID-19.
Less than a year after the peak of deferrals, the deferral period is set to expire on the March 31st 2021.
Banks strongly urging customers to resume mortgage repayments
Banks are now strongly urging their customers to resume their mortgage repayments if they haven’t already.
There are currently fewer than 80,000 loans in deferral with 9/10 deferred mortgages having already resumed repayments.
This information coincides with the December financial quarter data from Westpac, Bendigo Bank and ANZ.
As of January 2021, Westpac had only 19% of deferred mortgages still in motion to the value of almost $11 billion.
ANZ’s first quarter results show only 16% of the initial 145,000 deferred loans are still requiring assistance.
Commonwealth Bank’s reported going from 158,000 deferrals at peak to now having only 25,000 active deferrals, to the value of $9 billion.
Bendigo Bank’s record show only 3,000 active deferrals to the value of $1.1 billion.
Next phase of COVID-19 assistance: Financial Assistance Hub
Though the number of mortgage deferrals are significantly deceasing, many Australians are still in the thick of it requiring further support from their banks.
To help those in need, the ABA has launched the next phase of COVID-19 assistance called the ‘Financial Assistance Hub’, designed to help customers still in financial difficulty.
“The site aims to inform and assist bank customers so they know exactly where they stand, and the support their banks will provide them.” – ABA CEO Anne Bligh said.
The Financial Assistance Hub provides people with helpful resources and support in the form of an assistance guide containing helplines and answers to frequently asked questions regarding home loans, credit cards, personal loans, business finance and agribusiness.
How we can help negotiate your deferred mortgage
At Finance Mutual Australia, we negotiate and work with the banks on a daily basis to help our clients secure cheaper and more flexible loans. Our process is simple, first we learn about our clients, what their lifestyle, and financial needs are, and then we negotiate with the banks to find you the best deal. If you need a cheaper loan, contact us today.