Case study: keeping the home despite family difficulties

Young Girl Sleeping In Intensive Care Unit

The stakes were high for David and Karen, who were dealing with a child’s ill health and, as a result, extreme financial and emotional stress.

David and Karen were facing a number of difficulties in their life. First, their second child had fallen seriously ill. The family was regularly flying interstate to a Melbourne hospital for the best treatment available, leading them to require time off work. Ultimately, the situation began to take a toll on their finances and they were struggling to juggle their mortgage and three overdrawn credit facilities.

Not surprisingly, it was also taking its toll emotionally and Karen developed depression, which led to further time away from work. That’s when their friends referred them to an MFAA accredited finance broker.

“David and Karen were robbing Peter to pay Paul. Not only were they staring down the barrel of losing their home, but they were battling the very challenging emotional strains of caring for an unwell child and a partner with depression,” their finance broker recalls.

In such extreme circumstances, the adviser employed the services of a debt collector for the first time. While the fees were hefty ($550 was payable on each refinanced facility, as well as 15 per cent of the total amount saved), it was imperative that the financial stress on the family was resolved as quickly as possible.

“It was a non-conforming situation, so I decided the debt collector was the simplest step to take,” says the adviser. “He negotiated their collective credit card debt down from $48,000 to one payment of $15,000. I then arranged for a property valuation to be done and started to work backwards from there.”

The finance broker  was also able to refinance David and Karen’s home loan, negotiating far more manageable repayments that avoided them losing their home.

“This course of action not only enabled David and Karen to return to full-time work, but also saved their family home,” says the adviser. “They were faced with losing their house and their health, but after working together with a lender and debt negotiator, we were able to turn their lives around.”

David and Karen’s child has recovered and the family is now looking forward to what the future holds.

Finding an experienced mortgage broker whose expertise can help you find a lender and loan suited to your needs is so important.

** Names have been changed to protect clients’ privacy.

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