The recent lockdowns which have hit Australia hard and as a result, the country’s largest banks have frozen repayments on some 14,500 home loans. The Australian Banking Association also revealed that more than 600 business loans have also been deferred.
The lockdowns across the country have stifled the tourism, business, hospitality and construction and has forced Australians to rethink their finances.
ANZ revealed NSW accounts for three-quarters of the requests to get help with their mortgages. And the ABA’s data showed that NSW accounted for more than 10,000 of the mortgage deferrals and the number continues to rise as the lockdown extends in Greater Sydney.
Commonwealth Bank, Australia’s largest, announced it will pause repayments for affected borrowers for an initial period of two months.
“I want to assure all of our customers across Australia who are today facing tighter restrictions that support is available right now,” CEO Matt Comyn said.
But what are your options if you’ve been stood down, lost income or lost your job?
Here us our COVID survivor’s guide if you need help paying the bills.
More than 1.5 million disaster payment claims have been processed by Services Australia. Under the disaster payment scheme, which was announced in June, eligible workers from COVID-19 hotspots in New South Wales, Queensland, Victoria and South Australia will be able to claim money through Centrelink.
If you don’t have a Centrelink account, it is easy to apply for one.
The Federal Government revealed initially that claims of up to $600 would be made available to those who had lost more than 20 hours of work. They later increased the maximum amount to $750.
New South Wales
From July 28, the federal government increased disaster payments from $600 a week to $750 for those who have lost more than 20 hours of work and from $375 to $450 a week for those who have lost between eight hours of one day and 20 hours of work.
You must meet all eligibility rules to get the COVID-19 Disaster Payment – New South Wales.
You can get it even if you’re eligible on only one day during a payment period.
If you’re a member of a couple, you can both claim this payment. You and your partner will need to make separate claims.
If you’re a sole trader, you may be eligible for this payment. You should check if you’re eligible for a NSW business support payment first.
If you want to apply for a NSW business payment, you need to decide which is best for you. You can’t get the COVID-19 Disaster Payment and the business payment at the same time. You can read more about business grants and financial assistance on the NSW Government website.
Victoria has a number of support payments from both the federal and state government. Like NSW, anyone who has lost one or more days of work in a hotspot of lockdown zone is eligible for the payments. Individuals qualify for $375 a week if they lose less than 20 hours of work a week and $600 if more than 20 hours. Members of a couple can claim it separately. The payment is administered by Services Australia. And anyone who is told to self-isolate or quarantine is eligible to receive $1,500 for each 14-day period they spend isolating.
In terms of state support, those who are unable to work due to COVID-19 testing or isolation may qualify for the $450 isolation payment.
The claims are available from July 16, 2021 as well as from August 6, 2021.
COVID-19 disaster payments are available to residents in a number of areas including the City of Brisbane, City of Gold Coast, City of Ipswich, Lockyer Valley Regional Council, Logan City, Moreton Bay Region, Noosa Shire Council, Redland City, Scenic Rim Regional Council, Somerset Regional Council and Sunshine Coast Regional Council.
Residents who have lost less than 20 hours a week will be able to claim $450 and for more than 20 hours lost, $750. The period dates range from August 1 and the week starting the 8 August, 2021.
While the South Australian lockdown has lifted, residents who were affected by the restrictions from July 21 to July 27 are still eligible to claim the COVID-19 disaster payment.
Deal with debt
It’s advised to contact your creditors as soon as possible if you need help. Most of the big four banks, credit card and car companies have hardship measures in place for people who are unable to meet their loan repayments because of coronavirus.
These include a freeze on interest, a temporary deferral of mortgage repayments waiving fees, giving you more time to pay and introducing a more flexible way of repayments.
Commonwealth Bank was the first to pause repayments for affected borrowers for an initial period of two months. Other banks soon followed suit offering reduced payments, temporary pauses, and loan restructures to affected borrowers as part of the broader push within the sector to soften the financial fallout. Customers who are facing hardship are being told to get in touch with their financial institution as soon as possible to access support.
Other banks are following suit, offering reduced payments, temporary pauses, and loan restructures to affected borrowers as part of the broader push within the sector to soften the financial fallout. Customers who are facing hardship are being told to get in touch with their financial institution as soon as possible to access support.
Westpac also announced extra measures for business customers to ease cashflow concerns including overdrafts of up to $15,000 that are interest-free for 45 days in addition to deferrals.
But the Reserve Bank of Australia is fearful that this lockdown will increase credit card debt, something that many Australians have worked on paying off from the 2020 lockdown.
Keeping the lights on
If you can’t pay your utility bills because of the current pandemic, contact your provider as many energy companies have put in place some financial hardship program.
For instance, big energy providers like Origin Energy, EnergyAustralia and AGL will allow you to set up or modify an existing payment plan and request a payment extension.
There are also hardship and financial support programs which will help customers through the lockdown.
The Berejiklian government has re-introduced a temporary measure that increases the amount households can apply for to help meet their energy bills during the COVID-19 lockdown.
Eligible applicants can secure as much as $1600 a year to pay for their gas and electricity costs, up from the standard annual maximum of $1200.
The government said it would review the duration of the increase “in light of lockdown circumstances”.
Successful applicants for the Energy Accounts Payment Assistance have to show they are going without basic needs in order to pay an energy bill or that they risk being disconnected if they don’t pay.
Keeping a roof over your head
Many states have stopped evictions and most say landlords should be accommodating to tenants in distress. If you are struggling and need support check what councilling services are available.
A number of the banks have announced assistance for people with home loans, including deferring mortgage loan payments for up to two months. They are being accommodating so call early and tell them about your position.
The banks have taken a different approach this lockdown and have eliminated the ‘one-size-fits-all’ model and will try and tailor a resolution to your needs.
“We know every situation is different and our business bankers are checking in with customers to see how they are doing and what help they might need for their situation,” NAB CEO Ross McEwan said.
The interest on your loan, however, will keep being added, so this means that the loan term will be extended.
Worry free WiFi
Contact your internet provider regarding payment of your bills. For instance, Telstra has stopped late fees and disconnections for customers who cannot pay their bills. Optus has also waived late payment fees and suspended disconnection charges. Vodafone will also not charge late payment fees and suspension of services.