Homeowners Turn To Super Funds To Avoid Home Loss

Increasing numbers of mortgage holders are using their superannuation as a source to prevent losing their homes.

Since last July the Herald Sun asserts that more than 5000 people have requested permission to dip into their superannuation to avoid losing their homes. This could amount to more than $75 million.

It is becoming increasingly more difficult to retain home ownership as living costs rise and housing affordability drops. It has been reported that more people are turning to Welfare centres for assistance.

Fiona Guthrie executive director of the Australian Financial Counselling and Credit Reform Association stated that this was a carryover from previous lax credit control.

Under federal law homeowners can apply to APRA to obtain access to their super funds provided they can prove that a lender is about to foreclose on the family home.

Options to investigate when struggling

When finances are low investigate what options are available to you as there are several available.

  • Extend your home loan term.
  • Change to an interest only home loan.
  • Cease payment for a term.

You need to be aware that this is only a temporary solution and that it will cost more in the long run.

Revise your Budget.

  • Cut back on your spending and stick to essentials only.
  • Consolidate your credit card balances by paying off as much as possible and maximise the use of lower interest rates.

Consider downsizing.

You might need to consider selling your home or renting it out, and you could move to cheaper accommodation.

Compare Home Loans.

Consider changing your mortgage to another lender as there are some very attractive loans available at highly competitive terms and conditions. Check our "Compare Home Loans" section.

Another option is to approach your current lender to negotiate a better deal.

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What to find out more? Enquire now

Published on April 4-th, 2011 in Home Loans
Damon Rasheed is the CEO of Rate Detective, an Australian financial service comparison sites specialising in Life Insurance, Income Protection Insurance and home loans. Damon holds a Master's Degree in Economics from the University of Melbourne and has been involved in many start-up internet businesses.
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