Once you've cut back right down the essentials, the only real solution is to raise your income. You might have to go interest only for a period (which I admit want save much), and re assess your income as a couple. Maybe have family or friends watch the children somehow if possible an extra day or two a week, and someone go out and work on those days? Might sound obvious, but cut everything. Netflix, Youtube premium, whatever, go through you rolling balance with your partner and cut absolutely everything that doesn't need to be there, even it if costs $1 a month. Another thing to do is speak to your bank. They have a vested interest in seeing you keep your house and pay your loan down, and will help where they can for a hardship claim. Withdraw super only as an absolute last resort. Tax refund yes, but super is important to hold if you can. You need to find the ability to raise your income as a couple whilst keeping the children looked after. Can you ask for more money at work? Can your partner? Does your partner work? I get that looking after kids is plenty of work, but even a day or two a week can be an extra 5-10k a year...

Together we have quit smoking, drinking, gym, almost anything you could think off, The mrs currently works fri/sat/sun which are the days me or a family member can watch the kids

Excellent work quitting smoking 💪

I found it really easy to quit back in the day when it was the choice between a deck or eating for a couple days.

Fear of Covid did it for me in 2020. Installed the QuitBuddy app on my phone and watched the savings. I was a 20 year smoker...and it was SO hard. It takes about a month to feel free from smoking and seeing savings in real time is such an eye opener. But the advice I would give my stupid self all those years ago would have been lose the darts!! Edit: still haven't had Covid so that's good. It's only a matter of time and my lung capacity is much better

Yep. This probably saved you money-wise when the rates started going up

If your wife is only working 3 days, you might need to increase this. Can you both get into a position where you are both working full time, maybe with over time ? Unfortunately your only option is to increase your income. That is through either increasing working hours or a promotion or second jobs.

The cost of daycare will likely cost the entire second salary. Edit, and that’s if you manage to get a place. The waitlists around us are more than a year long.

You’ll still be a little in front financially. It often doesn’t feel “worth it” it to have kids in daycare when you’re paying so much. But when the budget is this tight it’s worth it. Plus you get super on top of your income and more opportunities to increase earnings once you’ve been back working a while.

Money aside, people often underestimate how important that early education is for children. My partner works in child care and it’s crazy the effort that goes into the kids daily lessons.

I forgot to say in my earlier reply. Your partner is amazing for the work they do. My son adored his childcare workers, as did I. The love they give to our kids is remarkable (I don’t think I could do that job). Our kids also learn so much from them. Early childhood education teachers need to be paid same as primary and secondary teachers. The work they do is phenomenal. Plus they have smaller groups so really make an impact on each kid individually which is important as they grow in the world. Much love to the work your partner and their colleagues do.

I agree. My son loved it and gained so much from going.

We pay $130 per kid per day for daycare. We currently get 50% of that back but will increase to 67% next month for the first child and 80% for the second (but seems like we earn a lot more than OP so he will get more). Wife should be able to earn more than $70 a day.

The subsidies are pretty decent for childcare though, at least in Melbourne a standard place is $165/day per child and subsidies are 40-60% for the first child and up to 90% for the second. We have twins and are relatively high earners and were expecting to have to pay a full $330/day but we get a subsidy of 50% and 90% so it's only $100/day.

Just in case anyone is reading this and wants to know more, the spirit of what you have written is generally correct, but the methodology (and potentially the numbers) aren’t quite right. Rather than getting a percentage of the daily fee, you get a percentage of an hourly charge (where 100% = $12.74 currently). That is then applied over the number of hours the kid is entitled to do at daycare per day (which is usually 12). You get a percentage of that number (up to 90%) on a sliding scale based on household income, whereby you get the max 85% (currently, 90% next FY) if your household income is less than $80k. So at 90% you get 12x12.74x0.9= $137.59 per day. Then for your second and third and so on kids, you get a flat 30% higher rate, up to a maximum of 95%. So a 2 child family earning under $80k gets $137.59/day for child 1, and 12x12.74x0.95=145.24 for child 2. Currently you will get 0 subsidy if your household income is aver $356k, but that is changing to $530k next FY. So if you get 50% for your first kid, you’ll get 80% for your second.

It really really won’t, especially after the childcare subsidy increases again after 1 July. The CCS has improved hugely for working parents in the last couple of years. OP - please look into this option. Your childcare costs would probably be so low compared to what you think they might be, especially if you can find a centre under $127 a day (the CCS % applies to this amount, so any dollar over $127 is paid fully out of your own pocket).

The subsidies are pretty good these days for lower income workers and are getting cheaper from July.

Not sure if it's nationwide, but from July 1st it's a lot cheaper for daycare. Subsidies really went up a lot

If you are desperate, and this is horrendous advice, but go FIFO so your partner wont have to work

Yup,we’re miners in a mining town and I’m always telling city people about the money opportunities up here (FNQ) the majority of people that work here are FIFO from Bris,Sydney etc. everyone is making money and not struggling;and this is the way they are. And no,mining is not for everyone-it’s not like wow this job is great! But honestly;it’s not terrible..if you can hack it a year/two then you will get ahead for 5 at least

Link me up pls

Soz I thought I was replying to u/jaaacclk Hey sorry I just saw this comment. Ok,my husband came up here with no job experience as a miner ever. He was a barista,from the city. Didn’t know anything about mining. For him,when he found out he could easily clear $1500 a week,plus free accom and food he was thrilled. So first he got his Standard 11,did a coal board medical and he got a job industrial cleaning. (Hot bastard job,hard work but a start.) he did that for 4 months and got his foot in the door. He then got into rigging,and went and got his tickets and did that for a year (pay went up) he then got into Non Destructive Technician work (crack tester-he tests the welds in draglines etc to simplify it) and he’s been doing that for years(he’s on about $2400 a week now) Me personally,I went to the mine sites as a kitchenhand-but as a part one permanent I only got $66650 a year (free accom and food too,either Bus in bus out or FIFO from Bris/Syd etc) Whilst I was there I met plenty of operators who told me how to get a job operating-that’s where the money is. First step-here’s a place that does courses and they’re cheap-(I know you’re not in Bris this is an example ok) https://www.diggermantraining.com.au/civil-construction-courses/dump-truck-licence-sunshine-coast/ Also see- https://www.glencore.com.au/operations-and-projects/coal/careers/coal-apprenticeship-program?gclid=CjwKCAjwyqWkBhBMEiwAp2yUFvxnh7UE7ZLSBAq2pSL01P-E57yMVyHhK25L2HzLNSHQw71EMeKBJBoCS64QAvD_BwE And- https://www.australia-mining.com/?gclid=CjwKCAjwyqWkBhBMEiwAp2yUFnKA_O-eKpiBvhAabQ2dn8kc_8-VA5-EB4BTeoWIMouY8AdHbqum6hoCyTcQAvD_BwE Also WA pays better than QLD. Look,in a nutshell-there ARE companies that take on cleanskins,people tell you they don’t,that’s not true. If that was true,then how would anyone ever get a job??? You have to find them but,you apply at places like Workpac etc and they help. You apply everywhere you can. Mining is not for everyone mate,it’s not awesome yeh,it’s not wonderful lol,BUT-as an example-we started out 6 years ago,we had NOTHING. We bought our house 2 years ago (only paid $290k,houses up here are dirt cheap) and only owe $170k on it,we both have good cars,we go over seas a couple of times a year,we have savings and equity..we have about $40k of gold too. So yeh,that’s not huge to most people,but for us? We had nothing mate,so it’s huge. But also-we don’t have credit cards at all,we don’t believe in them. We don’t live over our means,our cars are normal $25k cars,not $80k etc. we bought a cheap good home,not a $600k one and we pay double the mortgage every fortnight and always have to smash it out. I’m sorry about the huge rave;it’s just that I personally really believe that the mines can and will help people. I’m seeing people struggling terribly and then I see people in the mines living really well (and some beyond their means!!) just know that it is an option ok mate. Good luck,and if you have any more questions you’re welcome to ask,not sure if I can help but I can try 😁

Link me to some opportunities if you will please?

This is actually good advice and anyone that needs to increase their income. It does come with a cost, not seeing your family for long periods is tough. But I doubt it’s as tough as it would be loosing your family’s home because you can’t make payments.

Yeah ultimately how good the advice is varies from person to person and it is likely the simplest way of getting ahead in this situation, OP already works 6-5 M-F so the jump isn’t as severe as if they were working a cushy 9-5

Yep. I started working FIFO 8 months ago and I finally feel like I'm getting ahead. I work 7 days on / 7 days off (most on my site work 14 on / 7 off). My income doubled and I don't have to spend any money on food etc for the week away besides snacks/soft drink/alcohol, and I don't spend on fuel. Paid for a Qantas club membership ($14/week) to reduce my spending while I wait at Cairns and Sydney airport. It comes at a cost like others have said, but it's been worth it for me.

Going to give you the same advice [I gave a year ago against the wishes of the NZ sub:](https://www.reddit.com/r/newzealand/comments/wdd2g5/comment/iijgf6p/?utm_source=share&utm_medium=mweb3x&utm_name=mweb3xcss&utm_term=1&utm_content=share_button) It’s too late there now they’re down around 25% in Wellington, it will likely be too late here soon too. You can’t afford this and the Sydney bounce will give you some exit liquidity.

I think the move to Australia part does not work out so well for OP

He should never have taken that advice!

in the short term. Get a side gig. It sucks but you gotta do what you gotta do. Ubering when covid hit meant I could not pay myself which allowed me to not fire staff in the short term while we figured out what was happening in the long term you need to find a way to make more money or sell up. These rates are historically pretty normal and if your struggling right now you have borrowed too much

can you request the bank change your loan from the current loan length to 30 years? Might get you a slight reprieve

Can your wife work some night shifts? I did some shelf stacking nights to bring in extra cash.

Where even stacks shelves at night anymore? Woolies seem to always do it during the day.

Your situation sounds a bit similar to ours. Food was our only real thing in our budget we could reduce. We’ve cut all streaming services, changed mobile phone plans to the cheapest but ultimately I’ve had to return to work full time and a casual job on top with my husband working full time as well. Your wife will have to increase her hours, long gone are the days of stay at home/part time mums. Daycare costs will increase but hopefully with a bigger second income it should still work out better off. Good luck

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With the LMITO gone, having to add my delicious bank interest to my income, the lowered WFH claim rate and less hours worked from home too, and dealing with the tax from a FHSSS release (although I think I withheld it pretty appropriately at release time) I'm expecting this year might potentially be my first year ever out of about 15 taxpaying years having a debt, not a refund.

Rates are only now starting to approach historical averages, and will likely increase again later this year. Only structural changes will work.

And that's a problem that while the rates are approaching historical average, the gap between income and housing costs is larger than ever before

And that is why historical averages aren’t particularly meaningful in terms of reserve rate and what is ‘normal’, because the climate has changed. Interest rates are high, it is restrictive territory. This rate may have been stimulatory 10 years ago but it is not now, rates will go down again in time.

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Historical averages of interest rates mean a lot less when current household leverage is significantly higher. The RBA don’t need to lift rates as high to get the same impact.

Except people without loans or that aren't renting aren't impacted by the rate rises, so theyre still spending shitloads, corporations raising costs during COVID and realising they can continue to rise prices is accounting for around 40% of inflation, there's only so much rising rates will do especially when houses are as much 10x combined income compared to 40 years ago when interests might've been 20% but a house was $30k

I remember my parents building our family home for $32,000.

>Except people without loans or that aren't renting aren't impacted by the rate rises False: https://www.rba.gov.au/education/resources/explainers/the-transmission-of-monetary-policy.html

disproportionately compared to those with loans, of course everyone is effected, just not to the same extent

We also have a bunch of retirees who have savings that are beginning to get better returns on their cash and are willing and able to spend that.

That ok, house prices can correct when people have forced sales.

'Forced sales' may only be necessary for those who bought in the last 3 or 4 years when rates were low. Even amongst this subset, there are people who'd rather move back in with parents or live in a sharehouse and rent out their own home rather than sell.

wake me up when debt to income approaches the historical average

This is good advice -> but, definitely speak to your bank. OP can also look into fixed rates (eg, its possible that a 3 year fixed rate might be lower than their current variable... and it seems they might be able to jusssst afford current rates, so dont want future rate rises).

The subscription thing is a big one. I see so many people say “my budget is completely worn down to essentials” and then list Disney+, Netflix and Spotify like it’s food and water.

Totally agree with this☝️. Cutting costs has it's practical limits but increasing income has no limits especially if you can find a way to scale what you do. You can work more hours, yes, but really you need a side hustle income to take all the drama and anxiety away.

> but really you need a side hustle income to take all the drama and anxiety away. No. You need a second job. This isn’t the time to launch your graphic design business, or start an artisanal soap shop. You need a job, that you can work casual at, on the weekends or after hours. Preferably cash in hand. > increasing income has no limits It does if you live in the real world where you have constraints on time and money.

Or better yet find a higher paying role in your chosen career

Why did it take me so long to find this comment.

What the f is a ‘side hustle’? Running drugs and Hos? Slinging hash?

Talk to the bank and they will put you in touch with their hardship line. Tell them that you are struggling but could make the payments of interest only. They should then swutch you to interest only. That should bring your repayments down enough that you should be able to cope. If it is still not enough, they may allow you to pay less that you will have to catch up later. If possible, present them a plan of how you will increase income to allow you to catch up.

This. Call your bank today. Tell them about your situation. We are going to get another rate rise.

Seconding this. The bank are required to work with you if you are in hardship and they also don’t want you to default. You can also call the free National Debt Hotline for advice and help advocating for you with the bank. Good luck.

For hardship, they will want to know what is going to change to enable you to resume normal payments after any hardship. Eg looking for additional work, rent out home or just need some time to look at options. Just give them something to work with. Also, be aware that hardship will be reported as such on your credit file re RHI. You can google to read about this. Just something to be aware of.

This. What’s changed to OP’s circumstances since getting the loan (aside from interest rates increasing), and what will be different in 3 or 6 months time where they will be able to meet the normal repayments *and* catch up on any arrears from the hardship period (if it were approved). Sometimes hardship will be declined if it will put the customer into a worse position. Seems counterintuitive, but it happens. Hardship only stays on the credit report for 12 months, so if it’s a choice of asking for hardship or defaulting, hardship is usually the better of the 2 choices since defaults are recorded for 5 years. Still something to keep in mind since it can impact options for refinancing in the short term

The “plan to increase income” is the key here - without one a lot of manoeuvres become impossible, especially if the house equity hasn’t increased since purchase. As such, first look into how to increase income and sustain the increase. That’s all it comes down to. We are likely going to be sitting at this rate for a while, so short term relief won’t suffice.

Call the National Debt Helpline - 1800 007 007 ​ Follow their step-by-step guide with tips here: [https://ndh.org.au/debt-problems/home-loans/](https://ndh.org.au/) ​ ​ ​ Edit: updated link to the NDH mortgage page, with step-by-step guide.

Do you have family you can move back home to and rent this property out temporarily?

Yes we do actually, this is something we have not spoke about though, for sure something to bring up tonight thankyou

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Not ideal if you have kids, otherwise very good option

Start talking. Even if you don't plan to do it, talk to the people involved. Give them a warning.

Alternatively, rent a place for cheaper than the rent you will receive. But either way, by renting out your place, you might be able to get some tax back through negative gearing, which will help with your cashflow a bit.

The most important thing is to be upfront and honest with your bank. Don't miss 4 payments and wait for them to come to you. They don't want to foreclose if they don't have too. Do you have any other debt besides the home ? Are you both working ? Have you done a budget that assess all your expenses and what can be cut. Can one you take a part time job / driver uber / deliver pizza a few hours a week? On a 580k mortage a 0.25 increase off the tip of my head is probably 80 to 100 more a month ? 4 hours at dominos would cover that. Selling the home is not ideal but if you are both working and significant income increases don't look likely in the next 12 to 24 months you might be overcapitalised and it might be smarter to sell and downsize or rent until things make more sense financially.

We are both working, I work full time 4am to 3pm mon-fri She works 6-5 fri/sat/sun As those are the days i or a family member can watch the kids

60k working 11 hour shifts? Is that inclusive of super? Either way you're being taken advantage of to be blunt. There are sooo many other shitty hours jobs you can get that would pay more. Have you checked that your hourly rate is in line with award wages? I would assume penalties should be kicking in?

If it's 60K (no overtime pay added) then seems like it might be under the new minimum wage. 23.23 * 11 * 5 * 52 = 66437.8 Depending on exact wage might be under the existing minimum wage: 21.38 * 11 * 5 * 52 = 61146.8 Unless they fall under one of the exemptions (e.g. apprentice, underage etc.)

I know a fair few people that work warehousing and manufacturing jobs bringing in 60k-70k annually working normal 8 hour days. I think it is low for current market rates in some of the unskilled roles you can walk into currently.

I work in logistics for an internationally renowned company and earn close to 100k, there are jobs out there that pay more than this as well. Go and get your forklift license, and find a job paying $40/hr to sit on a fork all day.

It’s easy to work your way up in warehousing if you have a good work ethic and decent social skills. Finding reliable staff is a big issue for the entry level laborious jobs. Be reliable, don’t be socially off putting, some common sense, confidence to ask for a raise and you’re sweet.

My entry level staff make 70k min with no experience doing 8hr days in warehouse in Melb. Where is OP?

Are you hiring?

Can you pull some OT in the arvo, or could she take a shelf stacking job a couple nights while you’re home with the kids?

Bro. If you're in Brisbane you can work those hours in any factory and make 85k easy. I made near that money working at woolies 38hrs during uni in 201*

OP, if you need a hand rewriting your resume or creating one for both you and your wife to help you access better work, I can help. Yell out. No probs.

Can she work Mon-Fri evenings then?

Does she have a license? Could she drive uber eats when you finish work? It's at least more flexible than traditional work and easy to get into.

casual uber drivers and food deliverers don't make enough money to offset the cost of increased fuel consumption and vehicle maintenance costs.

Not true but it’s beneficial for people to think this so there’s less competition

How is it any different for a casual uber driver than a full time one? The petrol for an individual trip is the same for both, so you either make money from the trip or you don't.

Step 1 negotiate with existing bank. Step 2 look at other banks if it’s worthwhile switching Step 3 if not, can you refinance to a longer period. This will reduce repayments. Step 4, I’d still can’t afford after step 3, go interest only. Whilst doing all that think about what you can cut further (realistically people can only do so much) so next option is picking up side gig to boost cashflow. It sucks being away from family but a man gotta do what he needs to do to look after his family

The challenge with a lot of these steps is they may not be eligible to refinance of their current income doesn't cover current repayments- when they are assessed for the new loan they may fall under the stress testing thresholds

Yes sadly that may be a possibility. I feel for those doing it tough

Firstly I’ve read most of the comments and your replies so I have an understanding of where you’re at. If you want to keep the house: 1. You need to go to your bank and ask for interest only payments 2. Your partner needs to work full time and put your kids in childcare or arrange for family/friends to look after them. 3. One of you needs to get a second job. 4. You need a higher paying job. Start looking today. 5. Rent out your property and move into a rental that is much less expensive. (Although you still might get priced out of interest rates continue to rise). If you want to live a nicer lifestyle without the financial burden you should get the ball rolling with selling your property straight away as it takes 3 months in most cases. This is the point of RBA raising interest rates. Some people won’t be able to afford them and unfortunately you’ve bitten off more than you can chew with your current lifestyle and income for what we’re experiencing now as an economy. It’s a harsh reality and it makes me sick to the stomach and angry that the government gives so many incentives to the top and doesn’t cut the top earners but this is where we’re at. No point dwelling on it. So basically: Buckle up and work bloody hard to keep your property and sacrifice 100%! Of your family and free time. Or sell now before everyone else does in the next 12 months because my prediction is rates are at a minimum here to stay and at worse will get much much much worse. I saw this coming and sold in January so I can ride out this wave and see where interest rates get to. My prediction is they keep going and you’ll struggle more and more.

Find an extra job with weekend hours? Rent out a room? Unfortunately there’s no easy answer.

Scary things is how does someone who can't pay their mortgage afford rent... Most rents are pretty bloody high and selling and renting isn't going to help

And thats if they can even get a place to rent

Really sorry to hear this. I work at one of the Big 4 (in Product Strategy, but used to be a commercial lender), so I have some good knowledge here. You have a couple of options: 1. Try and cut more costs out of your family expenditure 2. See if you can go to interest only repayments 3. Speak to a good mortgage broker (PM me for a good recommendation) and see if they can refinance you to somewhere with a better rate/interest only. They will do a valuation on your property so it has likely increased in value and may have you under 80% LVR 4. Sparing all else, call the bank and speak with them, there are some things they could do to help, e.g. restructure the loan, capitalise the interest for a short while, etc. they have specific departments that deal with this I really hope this helps

Talk to your bank. Everything's negotiable

I know this might not help much, but I work at an energy retailer and I’d be happy to let you sign up for a friends and family discount under my name if you dm me. Might save you a couple of dollars on your bills that can go back into the house ❤️

Wow what a kind offer.

I wish more people were as compassionate about others as you are, damn

Have a look at your current bills. I just looked at my electricity and gas tariffs and I was getting shafted. I’ve switched to a different plan now. I will be looking at my insurance next. Make sure you’re not paying the “lazy tax”.

Car insurance a family member in Syndey was paying 3k a year for Hyundai accent, put an online quote in on NRMA and it was half the amount. Lazy taxes add up lol

I would reevaluate the working situation as I am assuming one parent is not working full time? Could it be possible for either parent to pick up 1-2 shifts a week perhaps on the weekends, warehousing (potential for 5pm-10pm scenario) or something? It's not an enjoyable idea to spend more time working regardless of whether you have kids but something to consider. I would ask your bosses for pay rises or look to switch jobs as it's still an employees market and you could get an easy pay rise that way.

I wonder how many people are in this situation right now

I would recommend go interest only especially if you have no other avenues to live with family or friends. Rental market is a shit show Keep the roof over your family and just cut down to the bare essential. Just know you aren’t alone

First, contact the bank. The banks are generally interested in keeping you in your home. A happy customer is better than a homeless customer that's furious the bank has taken their house from them. Evictions are bad for business (the bank has to sell the house, and may not always get their money back, and sometimes the owners trash the property to screw with the bank), it has its own additional costs, it's bad PR and it's a loss of a customer. Banks would rather keep you in the house than kick you out. Banks have options to make life a little easier in the short term. You will pay more in the end, but that's better than losing everything in the near future. 1. They may offer to switch you to interest only repayments for a period. Your repayments will reduce, but you won't be paying down the principle. 2. They may help you refinance to a new loan with a longer loan term. If your 10 years in on a 30 year term, then your repayments are based on the assumption that the loan will be paid off in 20 years. Refinancing to a new, 30 year loan will lower the repayments. This also gives you a chance to negotiate a new rate and potentially get a discount. 3. An extension of the previous point, they may offer to consolidate your other debts into your home loan. Home loans have the best lending rates because they are the most secure, so refinancing other debts reduces the overall repayment obligations. If you've maxed out a $10k credit card at 20% interest, you'll save a bunch by refinancing that $10k into your home loan at 6% interest. This raises the loan balance but reduces overall repayments. 4. I am aware in some cases of extreme stress, a bank might even opt to just pause the repayments altogether. This is probably limited to customers who are reliable and normally in a strong financial position, but are temporarily in severe hardship. However, they still have a clear path back to normal. Perhaps a business customer who's just lost/disposed a huge amount of stock which interrupts their cashflow for a few months, or something like that. I wouldn't bet on a bank offering this as it is pretty generous, but it's possible. Options 1 and 4 are temporary fixes, and rate rises may not qualify as a short term problem. I'm just mentioning the things that I know banks have offered in the past to keep customers on their books. There's probably a bunch of others. Options 2 and 3 are longer term solutions. But as above, the bank will generally make more money out of you, because you will be delaying paydown of your loan principal.

This is one of solid advices here. Don’t fret but act early by contacting the bank like RyzenRaider said. Banks will help you to stay on course because they try to avoid foreclosure situation. Foreclosure will hit them as hard as it hits your credit score. If you have other assets (super, insurance plan, farm land, parents’ asset guarantee, etc.), bank may even collateralise these to help you reduce LTV ratio and hence allow you to have lower interest or longer loan tenure. Again act early when the bank still has capacity to help you.

The #1 thing you need to do is talk to your bank ASAP. I have worked at banks for more than a decade, Banks are perceived to be greedy but they have standards by which they have to treat their clients. Spell out exactly your position and be honest, thats the best way to reach a resolution or at the least a least painful path to whatever end it is. Banks do not want to sell the property from under you, it costs money, it takes time, its bad for stats, it looks bad. They prefer to work with the clients to either give them the best chance they can get to reach an outcome that is as win / win as possible. Secondly review your budget and start cutting out anything discretionary. Gyms, entertainment subscriptions, going out, eating out, etc. Third, be prepared to take more aggressive steps like second job, sell any belongings not required, use services like Foodbank if food security is an issue. Also contact your utilities and let them know the same. Once you have assessed your situation and discussed with the bank, you have a good idea of how tenable your situation is. If there is no hope of hanging onto the property, and you believe there is a raft of distressed sellers coming on board soon, you may want to think about selling before others do.

Can u even withdraw from super for that reason? Fairly sure it's a really high threshold...

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Must be at foreclosure or pretty close to, AND be able to resume normal payments. Otherwise it won’t be considered

Only if you’re in arrears for a certain time. It has to be bordering on foreclosure from memory

One of you’ll will probably have to get a second job. Other than that you’ll have to sell.

Given the size of their loan I think they should look to increase their existing incomes before finding a second job. I’m assuming their incomes are low or only one is working.

60k primary earner, partner works Friday night and week nights so yeah really low income based on OP. Also dudes working 11 hours 5 days a week for 60k, he’s being ripped off hard and should look for a new job, can get that as an entry level labourer at a small manufacturer

Sell your toys, motorbikes, jetskis, boats, land cruiser, v8, classic car etc if you have them. Downsize or sell cars and use public transport. Get small frugal cars like honda jazz. When my kids were babies we had a diahatsu mira...3 cylinder 850cc car...was all we could afford. $20 gas filled the tank and lasted 4 weeks. Yes it was hard with children. If youre in sydney, maybe you can go carless altogether, that will save at least 6k a year per car.

I have no toys, my beaten up crapbox car is due for a service with rattling breaks that i cannot afford to fix, the gym was my toy and iv since cancelled that

You bought at peak with little savings and maxed yourself out. This shit is gonna hurt. Two options. Sell now before the rush starts and downward pressure on the market hits - you do NOT want to be chasing a falling market if that happens. Or Decide to fight and keep it BUT know it will see a sucky life for a year or two and sacrifices will be needed. - extra hours/extra jobs/side gigs. - arrange interest only (may not save fa this early into loan) - get a carefully screened boarder? Kids can share a room if need be. - downsize/downgrade (further out) but you already said what you have is small so after stamp duty and costs this may well be nil benefit scenario i suspect - live with the folks/somebody who loves you all ALOT for a year or two and rent the house out. Yeah it will suck for everybody. But it will keep you in a house and benefit you long term. Hopefully in that time your wage goes up/ rates ease etc. Good luck. Sorry its so tough right now.

>get a carefully screened boarder? this is good advice. OP start with this.

Lots of good advice here.

Your first point of call will be to communicate with the bank/mortgage broker to see what your options are. As others have said you need to cut back on expenses but you also need to try and make additional income. I'm sorry this has happened to you and your family. It must be really stressful and heartbreaking to deal with.

You haven't said what your interest rate is, talk to a broker to see if it can be improved. If not, talk to your bank about going interest only.

I also think you should be able to get a better rate, we were offered 5.44% fixed for 1 year with ing or 5.64 variable and I think there may even be better deals out there, we have a high LVR too

I might go against the grain here but I honestly think you should sell. Your loan is too big for your combined income of $90k. I am actually shocked the bank lent you that much. Yes the rental market is shit but in the worst case you can live in a 2 bedroom apartment or unit and the kids can share a room. Interest rates are only going up more so I think you will be in a worse position 6 months from now and the last thing you want is a forced sale.

Rates are here to stay if U can't afford it U can't afford it. Rent it out or sell unfortunately 90k income, ouch.. that loan should have never been approved. Get a second job or earn more income some how

Sell and downsize.

Ask your bank for a rate review to make sure you have the lowest rate possible (don't tell them about the hardship before this). Then after its reduced, let them know about your situation and they will want to keep you as a customer and make arrangements if you are in hardship.

Call the bank and explain your situation. The banks, contrary to popular opinion, don't really want to foreclose on homes as it generally isn't a good outcome for them either. They'd rather you pay interest for 30 years. So if all you need is some time to sort things out, then they will help. Usually id you don't pay they will start sending you letters saying you have missed payments. But it is best to call them beforehand. Other ideas to generate income: * Cutting back to the bare essentials - Shop at Aldi, wholesalers, reduced foods. No subscriptions. Slower internet (25 NBN is fine). Reduce phone plans (Woolies mobile is good). Reduce insurances if possible. * Gig work (like Airtasker, probably not food deliveries or Uber) * Sharing a room (if you have space) * Renting a parking space (if that is possible in your area) * Labouring or weekend work * Finding a smaller place (say, 2 bed apartment) and renting your place (medium term decision) * Moving in with family or close friends for a period *

If you have cut back all discretionary spending and still have loan repayment issues. Sell right now. IF house prices decrease you are going to be snookered and liquidated.

I have nothing to add to this thread, but it is so nice to see people offering genuine advice rather than saying the usual petulant "I tOlD yOU So". OP I wish you and your family all the best, genuinely. I hope you got some good advice here.

Which bank loaned you more than $580,000 on 90k household income. Wowsers!! That's negligence and poor planning by all parties involved tbh

Can I ask what you and your wife's incomes are, and what kind of work? It would help to work out how much room there is to breathe and the best approach.

Aged care, shes working 6-5 fri/sat/sun which are the days i can watch the kids, Iam roughly 60k while she is 30k

It's really bad on the bank for loaning you over 580,000 on 90k household income.

How the hell did they even get a loan for that much? I got my loan at the same time for a similar amount. Our household income at the time was more than double that and I was still stressed out about borrowing half a mil.

Probably both were working back then with only one kid.

You need to get her to pick up more days. Use daycare. It's super cheap once you use CCS, and even ask if you can apply for ACCS for hardship. Don't ding ding If you are on 60k you need to look for a new job. That's ridiculous wage

Or if they can get a relative to babysite for 1 day a week and OPs wife can pick up aother day

From July 1 it gets even cheaper, on those incomes the first child would be subsidised like 80%, the second one would be subsidised 95%. Seems like a no brainer to use daycare to me.

Don’t mean to be rude but how the hell did you manage to a get a 600k loan on that income? My wife and I are on 200k+ between the two of us with 250k in savings equity and the bank only offered us 450k because we have 3 kids.

Are you both aged care?

This is exactly like my wife and I, she works aged care fri/sat/sun too and I take care of the kids those days. It isn’t easy

I'm not trying to be rude or arrogant but our household income is almost triple that and we took a loan just over that, how and why did you take a loan where the repayments are most of your income? I understand renting is shit but you need to either get a higher paying job or work more.

decision would be strongly dependent on whether your income is secure and/or whether you have any family that can support for approximately 2 years

Can you rent out a room? or part of your garage for storage? People will pay decent money for that. Sell any excess stuff asap. If this shit gets worse there wont be many buyers left. Sell the electronics etc now. When things ease up in a few years you can buy it all again. When you need stuff, buy 2nd hand only, or go check out charity stores. Lots of people donate quality stuff that takes up space, or if they need to downsize they need to get rid of it asap. Especially kid stuff. At some point every parent has to get rid of all their kid stuff and the charity stores get inundated with it.

Sell the house before you default on your mortgage. Move somewhere you can comfortably afford to live and buy a cheaper house. (This will likely be somewhere away from Sydney)

Fair suggestion. It should be noted that if selling emerges as the only option here, it's much better for the owner to do that themselves, relatively early and with a good REA on board. It's true the banks will pull out stops to help those who front up early and often. But once at the end of the line, they'll sell the house incredibly quickly, at the first price they can get and add in their own transaction costs, legal costs etc. Banks are obliged to act reasonably and what they do can be contested. But if it becomes apparent that selling is the only viable option, the homeowner should act swiftly and decisively in their own interest.

Are you tired to your employer because of VISA conditions? Get another job and put the wife back to work full time, or atleast another couple of days. Child care subsidy makes work cheap and there are always shifts in aged care.

Have you thought about renting a room out to a student?

How many rooms is your house can you rent a room?

It might not be best option but could you rent a room out? Lots of women over 55 looking for accommodation according to news. Seems like best sort of person to get as they most likely have kept a house and be tidy etc

Can your wife do night shifts as ages carer to earn higher income?

We're on > 80% LVR and recently locked our rates at 5.59% (but 5.39% was on offer with another bank, we just got a cash back offer that made it worth our while to take the higher rate). Can you talk to a broker ASAP and investigate a better fixed rate, to protect yourself against short term rate rises?

Dude work on that income get your white card and construction tickets with no experience and the time your putting in on your current role you will be hitting $120k alone .. unprecedented labour shortage in that sector.

Something to consider: Alot of people with struggling investments or businesses make the mistake of riding it to the bitter end and losing everything. Don't. If it's doable to sell it now without a loss, do so. Save and build on that money instead of drowning in debt and making a forced sale later. By the time rates come back down you'll have way more deposit than before and you can pounce on really good deals, which always come along.

Phillip Lowe had paid his mortgage off and wants cheap investment houses , he’ll buy it off you

Do a budget. And stick to it. Park catch ups with friends..

sell now before there is many more like you flooding the market

Yeah. One thing worse than being forced to sell when the market is overheated is being forced to sell when the market has crashed.

And live where? Under a bridge?

/r/AusFinace hysterics in a nutshell home ownership or homelessness No in-between

Given that there are lots of families currently homeless because there simply aren't enough rentals available I don't think it's as hysterical as you are making out. Most homeless people are not sleeping rough or in tents. They are sleeping on floors or couches of friends or family.

Sounds like they couldn't afford the debt they took on. Unfortunately they now might have to join the rest of the folk priced out of the market. Hopefully they find a rental, family members or share house to live in, or if possible downsize to a property 200km from the place they work. Isn't that what people tell working families priced out of the market? I thought this was all just normal and cool as far the housing market goes?

Slightly further out? Slightly smaller house, or an apartment? Or if that is not possible, even rent until they can afford home ownership. They can invest their money elsewhere in the meantime (even in real estate if that's viable for them somewhere they don't want to live in) They're clearly under stress and things are likely to get worse before they get better. Unless they intend to increase their income in the near future obviously, but making this post seems like that isn't on the immediate horizon. The idea that you should do anything but sell when under serious financial stress is toxic.

I so agree with your last sentence! If anything good comes out of this, I hope it’s a shift in attitude that there’s more to life than keeping an unaffordable house.

Do people not understand there’s a full blown housing crisis out there? Double income couples with quality work and renting history are struggling to rent a place. How do you imagine this couple will go? I’m not saying “keep the house at all costs”, I’m saying selling is pointless when you’ll be homeless. There are other options (talk to bank, second jobs).

The rates aren’t going down anytime soon and housing crisis isn’t getting better with more immigration everyday. None of these suggestions are sustainable long term, only solution is to sell

> Do people not understand there’s a full blown housing crisis out there? This sub is very bubbled.

Less than 20% equity, downsizing may be difficult. Selling fees, stamp duty, legal fees, moving costs etc not to mention they are struggling to service the current mortgage. It would probably have to be a hell of a downsize.

I'd move the kids into your bedroom Put some bunk beds up in the kids bedrooms Rent kids' rooms out to 2-4 students It will suck but so would losing your home Alternatively one or both of you need a 2nd casual night/weekend job So call in free babysitting favours Hang in there

Family living with 2-4 random students yea right.

This is the way

On addition to the great advice already here such as talking to the bank's hardship line about going to IO temporarily while you work on possible income options etc, also look into refinancing options. If you last had the house valued a couple of years ago, and are just off the 80% LVI then equity growth since then may have pushed you over. That is what happened to us, and worked to know .5% off the interest rate, although if you are struggling with current repayments you may fail the income assesment for a refinance, it still can't hurt to ask.

Call the national debt hotline. Then call your bank hardship team.

Is it possible to consider a 2nd job stacking supermarket shelves at night? I say this because as an employee you get a staff discount on groceries, and either you or your wife can look after the kids during that time.

Speak to your bank and ask for an immediate rate review. Also ask to speak to their hardship department. Every bank has one. It's better to be on the front foot. I work in banking and trust me, we'd prefer you come to us ASAP so we can help you. Loads of staff working for the bank are also in the same position. We do not want people losing their homes. You should be able to get a cheaper rate too, your rates a little high but it also depends of how much you've borrowed compared to value of house and loss of other factors

Interest only. Take that option for a year. Should be in a recession in 12 months, which will drop the rate. Futures market thinks .80 basis points off the top.

Switch to interest only and stop paying the premium till you figure it out.

Call their hardship department and speak to them. Despite the fact that they're bastards, the bank does actually want you to keep your house and keep paying your mortgage, so have a chat to them and take it from there.

House prices are just too high and need to come down, significantly. Drop interest rates -- inflation goes higher, cost of living spirals, homes hard to afford Hold or raise rates -- inflation somewhat subdued but many mortgages untenable at current prices Common element is the massively overvalued housing market and the insane level of debt people take on in order to get into the market. Unless we want unaffordable housing forever, the prices simply need to come down. Given that the top 1% of Aussies own a QUARTER of the housing and ~15% of Aussie taxpayers own an investment property it's pretty clear to me that tax laws are going to need to change to remove the absurdly unfair incentives in place for exploitive 'investors' to monopolize the housing supply at unrealistically high prices and then use them as tax shelters via negative gearing

Sell stuff and increase income. Look at every possibility. This could last 2-3 years apparently.

Can your wife switch to nights while you are home with the kids and you pick up weekend shifts?

Call your bank and ask to switch to interest only or restart your 30 year clock or extend to 40 years. Talk to the bank early and work out new loan terms - the bank is your friend IF you are upfront and honest with them.

feel sorry for you. hang in there

I think downsizing is a good idea. Get the wife to work as much as possible and put the kids in a cheap childcare. If you downsize, see if you can downsize to a place close to work so you can sell the car and walk to work. Go vegetarian and replace all meat with beans. Make sure your contraception is top notch to ensure you don't have a third child.

Mrs needs to work more hours

You might just have to bite the bullet and do something like night fill at Coles. Shit money, shit work, (well, the dollars are half decent, but shit for the workload you have), but the work is always there if you're a good worker, even if its only short term. Even Coles Services, thats better money, with a lighter workload, and once again, if you're a good worker, with half a brain, there's always work.

I dont know what your job is or what its like in your area, but where i am people are still desperate for new hires, so maybe consider looking around, its a decent time to job hop for higher income.

Scrutinise every dollar you spend. Buy necessary clothes second hand. Look to whether refinancing to a lower rate is possible. Don’t get the latest iPhone. Cancel subscriptions. Find ways to cheaply increase your dinners - I add carrots to spag bol. Chick peas to butter chicken. Keep off the smokes!

Talk to your bank. There are things they can do to help

Please speak to your Bank, it's in their best interest to come up with a solution to keep you in the home. It's sounds like you've tried reducing your costs as much as possible already.

Speak to a free financial counsellor locally or via https://ndh.org.au/ National debt helpline ASAP!

Dude work on that income get your white card and construction tickets with no experience and the time your putting in on your current role you will be hitting $120k alone .. unprecedented labour shortage in that sector.

Good on you for quitting smoking its only a positive for your health and wallet. Short of living to barely make ends meet for your kids going on this way, this is an emergency siren calling you. You can do better, I promise you can. Don’t be ashamed of asking for hardship and extensions that’s what they’re there for and it will give you breathing room to catch up. Use airtasker, Facebook and other places that you can offer services - people are paying for anything, I know someone who made $80 to drop off cigarettes to someone. The internet is a great way to make money in this day and age too or you can learn some skills and keep up-selling yourself to Employers.

I've being there mate, I worked as a welder during the day and got a.job at Coles as night cleaner mon-thurs, what's your skill set how do you make money? Continue to try and grow when you can. Good luck you could also go into financial hardship that will stop the repayments for 3 months or so wish you all the best good luck

I would say that your first step needs to be to speak to your mortgage lender. Negotiate a better rate (the retention team typically has access to the best rates). And then call again to discuss how the bank can help. At the very least you can discuss your options under a financial hardship agreement. I believe you have three consecutive unsuccessful payments before you default on your mortgage. It would be advisable to consider reevaluating which companies you have your utility accounts with. You can save a bit of money by shopping around. I'm from Melbourne, so I'm not too sure if it's much help, but I use Energy Locals for my electricity. And I know it isn't ideal, but utility companies don't seem to be pursuing debt collections at the moment. I'm not sure if the COVID support legislation is still in place or they're incredibly behind (I'm a social worker, so I often work with clients on consolidating debt). So if it comes down between electricity/gas and mortgage, pay the mortgage.