Mortgage stress: more Aussies forking out majority of salary on repayments

The ongoing high interest rate environment has meant the average Aussie is now contributing 34 per cent of their income to paying their mortgage each month, according to Finder.

Some homeowners were spending substantially more.

One in 10 Aussie mortgage holders said that half their income went towards their mortgage each month, while 12 per cent said they were spending a staggering 60 per cent of their total earnings on repayments.

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Mortgage holders are forking out as much as 60 per cent on their home loans. Picture: Newswire /Gaye Gerard

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Richard Whitten, home loans expert at Finder, said rising interest rates were a brutal blow for households’ bottom line.

“Aussie mortgage payers are grappling with the most expensive home loans in 13 years,” he said.

Finder’s Consumer Sentiment Tracker revealed 34 per cent of Australians struggled to pay their home loan in June.

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“In many cases households are spending far more than they planned on their mortgages after rates went up 13 times in 15 months. Some borrowers, especially people who bought a house recently, may be stuck in mortgage prison without any option to refinance due to serviceability issues.”

Finder’s consumer tracker revealed 34 per cent of Aussies struggled to pay their home loan in June.

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He urged mortgagors to plug any money leaks such as paying too much for utilities and other expenses.

“Saving a few hundred dollars here and there can add up to big bucks which could make all the difference come the end of the month,” he said. “If possible, cut down on all discretionary spending such as takeaway and divert those savings to an emergency fund.”