Lockdowns prompt home loan deferrals

Some 20,000 customers have received hardship assistance during recent lockdowns. It includes more than 14,500 home loans being deferred, according to data released by the Australian Banking Association. More than 600 business loans have also been deferred. The ANZ recently advised that NSW borrowers accounted for three-quarters of the requests it is getting for help with mortgages. Comparatively, during the peak of the crisis in 2020, almost 500,000 home loans and more than 225,000 business loans were deferred. The latest data on consumer confidence, unemployment, spending and savings, and home loan deferrals has prompted both Treasurer Josh Frydenberg and Prime Minister Scott Morrison to express confidence this week that the economy would recover strongly. Meanwhile Anna Bligh, chief executive officer of the Australian Banking Association, has reminded customers not to tough it out on their own. “Lockdowns continue to bite across several states, and banks are again stepping up to help,” Ms Bligh said. “Support is available to all small businesses and home loan customers significantly impacted by current lockdowns or recovering from recent lockdowns, irrespective of geography or industry.” Hardship approvals and loan deferrals are heavily skewed toward NSW residents, due to the continued lockdown. NSW home loan deferrals account for more than two thirds of total deferrals, while almost 80 per cent of deferred business loans are also from NSW. It sat at 10,452 deferrals in NSW and 2580 in Victoria. The number of customers accessing hardship grew by 73% this week, compared with a growth of 153% the week before. Growth in housing loan deferrals similarly slowed from 344% to 79%, while growth in business loan deferrals grew from 93% to 108%. Banks have dedicated hardship teams. Almost 24,000 people since early July have accessed a range of support measures offered by their bank and 64% of these have opted to defer their loan repayments for up to 3 months.