Mort­gage-belt pinch

If peo­ple are strug­gling to pay mortgages now, what hap­pens if in­ter­est rates go up, asks Craig Bin­nie

Herald Sun - Property - - Finance -

IF­TEEN per cent of bor­row­ers says they are strug­gling with their mort­gage pay­ments even though in­ter­est rates are at a gen­er­a­tional low.

For­tu­nately 68 per cent of bor­row­ers ex­pect to eas­ily meet their re­pay­ments.

A year ago, when rates were con­sid­er­ably higher, the fig­ure for strug­gling bor­row­ers was 23 per cent.

A sur­vey by mort­gage in­surer Gen­worth Fi­nan­cial found first-home buy­ers more likely to be strug­gling with their re­pay­ments (19 per cent) than in­vestors (9 per cent).

Bor­row­ers who were do­ing all right now but ex­pected to have trou­ble in the fu­ture were most likely to be mid­dle-in­come earn­ers who had sev­eral debts and were fac­ing the threat of un­em­ploy­ment.

Gen­worth chief ex­ec­u­tive Martin Barter says apart from their mort­gage, strug­gling bor­row­ers had more debt than the na­tional av­er­age such as a per­sonal loan, car loan, in­vest­ment

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