More households facing mortgage stress as banks pass on rate hikes

ABC NEWS (Australia)

It's estimated almost one-and-a half-million households could now be at risk of falling into mortgage stress. Many people are re-thinking their household budgets as the nation’s big banks waste no time in passing on yesterday's interest rate hike piling on the pressure for those who are already struggling.

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00:02In Australian suburbs, mortgage pain is hitting home as news of another interest rate hike

00:08drives up loan repayments.

00:10I was surprised because obviously everyone thought it would be coming in May.

00:14I think it's a little bit ridiculous to put the interest rate up two months back to May.

00:19According to research from Roy Morgan, the latest rate rise could leave more than 1.4

00:24million home borrowers at risk of mortgage stress once the rate increases are passed through.

00:30The Commonwealth Bank, ANZ and NAB will hike home loans on the 27th of March.

00:36For Westpac borrowers, it's the 31st.

00:38Yes, we can help you with that today.

00:40Calls to financial counsellors have increased.

00:43After the interest rate rise, we saw our busiest February since before the pandemic, so since 2020.

00:50Australians facing tough situations are being advised to get on top of their debt faster.

00:56That might mean calling up your creditors, calling up the bank or your telco or your energy

01:02company and explaining your situation and asking for a hardship arrangement.

01:07The Reserve Bank's hiking interest rates to cool the economy and stop prices from rising

01:12so fast.

01:13Economists think it has more work to do.

01:15We are forecasting another 25 basis point rate hike in May and that will take the cash

01:20rate back to 4.35.

01:22The pain for mortgage borrowers is expected to increase as the cost of living crisis collides

01:28with mortgage pain.

01:29But it's a different story for Australians who have paid off their home and have savings

01:34in the bank.

01:35If interest goes up, that's good for me.

01:38Other retirees are concerned for their children.

01:41Two daughters have got mortgages and they're finding it a little bit tough.

01:46It will affect our sons, so it's a hard time for them as well with petrol rises as well.

01:53A double whammy to the hip pocket nerve.

01:56A double whammy to the other, a double whammy to the third time it has a big fatigue.

01:57A double whammy to the first time I remember that would have been kept in the ayamze.

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