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Media Release by The Hon Tanya Pibersek MP

Boosted services for people at risk of homelessness in Western Sydney

Joint Media Release with:

  • The Hon John Hatzistergos MLC, NSW Attorney General

NSW Attorney General, John Hatzistergos and Commonwealth , Tanya Plibersek today launched the Mortgage Stress Legal Support Program to assist people who are in danger of having their homes repossessed.

The new service will provide specialist financial advice and legal representation to help borrowers who are having problems with their mortgage and other debt issues.

The program is designed to increase the level of assistance available to people in two of the regions of NSW most affected by the global financial crisis – Western Sydney and the Central Coast.

The NSW Public Purpose Fund has approved funding for two years for the program, which will be delivered through Legal Aid and the NSW Consumer Credit Legal Centre. The funding will be allocated as follows:

  • $280,000 to the NSW Consumer Credit Legal Centre
  • $240,000 to Legal Aid NSW

“The program will assist people who are experiencing financial hardship to save their homes, for example, by negotiating a variation of their loan repayments until they are able to get back on their feet,” said Mr Hatzistergos.

The program will employ four additional solicitors and one financial counsellor, based in Parramatta, Sydney CBD and Gosford.

“The global recession is expected to continue impacting families, through increased unemployment and mortgage stress.”

“In these tough times it is important governments provide whatever help they can to families facing hardship.”

The NSW Credit and Debt Hotline, a joint Commonwealth/State government funded free telephone service (1800 808 488) reported a 36 per cent increase in calls in 2007, and a 104 per cent increase in 2008.

The volume of calls has remained high this year, with some service providers saying they are already experiencing an upswing in the number of cases of homelessness across Western Sydney.

Ms Plibersek said the Rudd Government was committed to early intervention to try to prevent mortgage stress and homelessness.

To help meet additional demand as a result of the economic downturn, this year’s Federal Budget committed an additional $20 million across the country in one-off funding for legal assistance with a focus on early intervention.

This includes $480,000 for community legal centres in Western Sydney, which already assist disadvantaged Australians in areas such as consumer protection, mortgage and tenancy disputes, welfare rights and homelessness.

The Rudd Government also increased emergency relief funding from $47 million in 2008-09 to around $70 million in 2009-10. Some $4.3 million of this funding is going to charities in Western Sydney to assist families, including those on middle-incomes, affected by the global financial crisis.

The Commonwealth currently funds four financial counselling services in Western Sydney, including two new services announced by Community Services Minister Jenny Macklin in January.

“I am pleased to announce today that the Commonwealth will fund an additional full-time position at the Northern Area Tenants Service and two part time positions at Parramatta Mission and Bridging the Gap Sydney West,” Ms Plibersek said.

“It is important to help homeowners in financial trouble understand they can negotiate with their lender and, where possible avoid repossession of their home.

“The Rudd Government has made addressing homelessness a national priority and Homelessness White paper delivers an additional $1.2 billion for homelessness services.

“The Rudd Government has also reached an agreement with the major banks to negotiate postponing mortgage payments for up to 12 months with borrowers who have lost their job.”

On top of this, the Rudd Government’s Nation Building Economic Stimulus Plan will see an additional 222 new social housing dwellings constructed across Western Sydney – one quarter of the allocation for Round One in NSW, with many more to follow.

Legal Aid NSW has also published the Mortgage Stress Handbook, a free user-friendly guide for people experiencing difficulty. The handbook and a brochure on mortgage stress are available at Legal Aid NSW Online (www.legalaid.nsw.gov.au).

For more information about help available for people experiencing difficulties with their mortgage, call LawAccess NSW on 1300 888 529.