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Mortgage stress handbook

2. Is my problem urgent?

Your right to make a repayment arrangement depends on where the lender is up to in the process to take possession of your home. Chapter 3 describes the steps the lender must take to get possession of your home.

To work out what to do next you need to know:

  1. Has a default notice been sent to you? The default notice must give you at least 30 days to repay the arrears (the amount you are behind in repayments plus your normal repayment due that month).
  2. Have you received a Statement of Claim or Summons from the Court for possession of your home and/or the amount outstanding on your home loan? If so when did you receive the Statement of Claim/Summons?
  3. Has the lender obtained judgment from the Court? If you received Court documents some time ago, check with the Court to see if the lender has obtained judgment. The lender can apply for judgment at any time after the time for response to the Court proceedings has expired. Details for contacting the Court will be on the Court documents. You will need to tell the Court Officer some details included in the Court paperwork, so make sure you have it with you when you ring. A list of Court contacts appears at Useful contacts, Chapter 14.
  4. Have you received a notice from the Court telling you to vacate your home?

Remember! Remember

If any of the previous 4 steps has occurred your matter is urgent. If the lender has not obtained judgment you need to see Chapters 6 and 7 immediately. If the lender has judgment, get legal advice (see Chapter 14 for Useful contacts) and see Chapter 12.

Complaint resolution

All home loan lenders must be members of the approved free complaint resolution scheme. In fact all lenders who give consumer credit loans—such as credit cards and personal loans or loans for investment in residential property must be members. The details are:

Australian Financial Complaints Authority (AFCA)
1800 931 678

Using the complaint resolution scheme, AFCA, is the best way for you to resolve your financial hardship complaint with your lender. This handbook will refer to complaint resolution throughout as it is the most important right you have.

If you are unsure where you are up to in the repossession process you should consider lodging a complaint with the complaint resolution scheme, AFCA, immediately because:

  • the complaint resolution scheme, AFCA, is free
  • the lender cannot start or continue legal action while your matter is being considered by the complaint resolution scheme
  • it will give you the opportunity to negotiate with the lender (with the assistance of the complaint resolution scheme, AFCA)

Once judgement is entered you cannot raise a complaint or get financial hardship assistance to vary the loan from AFCA. AFCA has a very limited post-judgement jurisdiction to help obtain a stay of an eviction if there is an imminent refinance or sale; or for more time to move if you are facing personal hardship (such as temporary serious illness or incapacity). If you receive court documents you must lodge a complaint with AFCA immediately, as they will not be able to review that complaint once judgement is entered except in this limited way.