Behind on your home loan? Act now, avoid foreclosure

• Contact your lender before you default; propose a realistic plan and pay something now to show intent.
• Use forbearance tools: payment holiday, interest-only, arrears spread, term extension, only if the cash-flow shock is temporary.
• If recovery looks unlikely, list early, price realistically, avoid legal costs, and protect your credit for the next move.

Why prevention beats cure

High inflation and a 15-year-high rate cycle have squeezed households; the share of up-to-date bonds has slipped from historic norms.

Waiting worsens fees, legal risk, and credit damage. The play is to take control early:

5 Immediate steps to take

1. Call your lender before the debit date. Ask for hardship options and agree a plan you can actually keep.
2. Pay something now. Even a partial payment signals intent and keeps your account in “active” status.
3. Cut burn fast. Cancel non-essentials, negotiate insurance, utilities, and redirect savings to the bond.
4. Document your case. Payslips, bank statements, a 6 - month cash-flow, arrive with numbers, not a story.
5. Loop in your partner/family. No surprises, shared plans beat secret stress.

Forbearance before foreclosure

If your setback is temporary (retrenchment, medical, contract gap), ask about:

• Payment holiday (short pause, interest keeps accruing).
• Interest-only period (reduce instalment, maintain goodwill).
• Arrears capitalisation or arrears spread over future payments.
• Term extension (lower instalment; higher lifetime interest, run the maths).

Caution on debt review

‍It can help in some cases, but it also freezes access to new credit for years and doesn’t guarantee saving your home. Avoid aggressive “one-size-fits-all” operators; get independent advice first.

Expert view Renier Kriek (Sentinel Homes)

‍“Being unable to afford your home loan instalment is not a position anyone wants to be in. Steer your own boat rather than leaving it to the vagaries of the foreclosure process.”

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“Don’t let unreasonable hope be the enemy of your future financial well-being. If your income won’t recover soon, list early and control the exit.”

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Way forward (Practical Playbook)

Week 0 - 1

• Call lender; lock a written forbearance plan.
• Make a good-faith payment (even partial) immediately.
• Build a 12-week cash-flow with cutbacks and a repayment roadmap.

Week 2 - 4

• If income recovery is doubtful, instruct an estate agent and price to the market (not your memories).
• Prepare a clean sale pack (title, compliance, rates clearance estimate) to shorten timelines.
• Explore bridge finance or family support to avoid default while selling, only if numbers stack.

Always

• Track DSCR-style coverage: can monthly net income cover instalment plus basics? If not, pivot quickly.
• Protect credit: avoid missed payments on everything, not just the bond.
• Keep records of all lender communications and agreements.

Bottom line

‍Early action preserves options. Engage, pay something, restructure if the shock is temporary, otherwise sell on your terms before legal costs and credit damage do it for you.

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