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Lenders offer loan relief for flood victims

Customers affected by the NSW floods are being offered loan repayment deferrals, among other forms of financial relief, as more heavy rain is forecast.

Widespread and persistent rain falling over NSW and lower Queensland, caused by “a strong, high-pressure system over the southern Tasman Sea”, has caused flash flooding and damaging winds across the area, leaving families displaced, properties damaged, and some communities cut off.

Given the flooding, several lenders have already begun offering customers financial support packages, with most providing:

  • A deferral of scheduled loan repayments (home loans, personal loan, business loans etc);
  • Waiving fees and charges, including break costs on early access to term deposits;
  • Debt consolidation to help make repayments more manageable;
  • Restructuring existing loans free of the usual establishment fees;
  • Deferring or “customising” interest payments (on a case-by-case basis);
  • Offering additional finance or emergency credit limit increases to help cover cash flow shortages;
  • Deferring upcoming credit card payments; and
  • Increasing emergency credit card limits.

Lenders are also offering their insurance customers emergency accommodation and expedited insurance claims. 

All affected customers are being asked to contact their lending or banking institution directly should they require support.

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The Australian Banking Association’s CEO, Anna Bligh, commented: “Once the cleanup begins, it’s important for people to know that they can talk to their bank to seek assistance.” 

“The message from banks is clear: Don’t tough it out on your own, your bank is ready to help”. 

The Australian Government Disaster Recovery Payment and Disaster Recovery Allowance has also now been activated by the federal government to support those who have been affected, suffered significant losses or serious injury, or whose income has been affected.

The Australian Government Disaster Recovery Payment provides non-means tested payments of $1,000 for eligible adults and $400 for eligible children.

Wild weather expected until Wednesday 

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At the time of writing, there were evacuation orders in place for 28 areas, with a further 16 areas issued with an evacuation warning.

In Northern NSW, there were 35 isolated communities, including Taree, Bellingen, Wingham, Harrington and Laurieton.

Some parts of NSW are experiencing the worst flooding in over 50 years, and the Hawkesbury Nepean Valley has seen record rainfall, with the Hawkesbury River rising to levels not thought to have been seen since 1961.

Roads in some areas are cut off by water, and there is an increased risk of landslips and falling trees during this period. 

Major flood warnings are now in place for the Colo River, Hastings River, Hawkesbury River, Macleay River and the Wollombi Brook.

On Saturday (20 March), 500 gigalitres of water – said to be the equivalent of releasing the capacity of an entire Sydney Harbour – was released from Warragamba Dam in 24 hours.

Across NSW, 1,400 State Emergency Service first responders have conducted over 700 flood rescues and responded to over 7,500 requests for assistance.  

A low-pressure trough that has formed in the west NSW has also caused heavy rain, which is expected to reach the Tasman Sea later today (23 March), with the potential to form a low-pressure system that may bring increased rainfall, strong winds, damaging surf and abnormally high tides to the east and south, according to the Bureau of Meterology (BOM).

Heavy surf and abnormally high tides may also cause sea water flooding in low-lying areas, BOM has warned.

As well as warnings for NSW, BOM has issued a severe weather warning for western and southern Queensland, which could extend to the Southeast Coast this morning (23 March), and a number of flood warnings remain in place for parts of the state also.

Most areas of NSW will see a clearing trend early Wednesday as a drier airmass moves into the region.

‘Australia is being tested once again’

Speaking in Parliament on Monday (22 March), Prime Minister Scott Morrison noted that “Australia is being tested once again” as NSW and some areas of South-East Queensland face “an extraordinary deluge”.

Mr Morrison acknowledged, thanked and “paid tribute” to “the extraordinary efforts of our volunteers and the emergency services in responding to these terrible events”, stating it was “very difficult and dangerous work”.

He warned: “And there is serious risk still ahead.

“Heavy rainfall is likely to continue up much of the eastern half of New South Wales and into southern Queensland [on Tuesday]... heavy falls will also develop over northern and central inland parts of New South Wales, bringing the risk of flash and significant river flooding to several additional catchments.

“A different low-pressure system is also expected to form off the southern New South Wales coast, bringing rainfall there also.

“Thankfully, the current forecast has conditions easing state-wide from early Wednesday but we will watch and see.”

Mr Morrison said he was working “closely” with NSW Premier Gladys Berejiklian as the floods unfold.

“This is an ongoing situation that is evolving and is extremely dangerous,” the Prime Minister said.

“We are meeting regularly to be updated on the events and to direct our response. We are grateful at this point that no lives have been lost so far, but weakened foundations for buildings, for roads and trees, they all create risk, as do downed power lines and rising water levels.

“So, we ask all Australians in these affected areas to please use caution.

“Check in on your neighbours and those who you know that are alone,” he said.

“Please heed the advice of authorities. Where there are orders to evacuate, please follow them.”

He continued: “This will be a very difficult week for hundreds of thousands of Australians, if not more, as we face the immediacy of the floods, and there will be many difficult months ahead as the clean-up and recovery from this natural disaster gets underway.

“We have very competent agencies in our state governments. They are very good at dealing with these types of emergencies. They are doing a tremendous job right now and the Australian government is standing together with them in ensuring that they can be delivering in these most urgent of times.

“But above all, we rely as we have now for a long time, on Australians themselves. They have shown as we can together that we can get through these things when we work together.

“And that is what we’ll do in the hours, days, weeks and months ahead, responding to this disaster like those before it and then rebuilding and recovering afterwards,” Mr Morrison said.

Police services are reminding the public to “exercise caution” as regions brace for further rainfall and many river systems yet to reach their peak.

“The message from Police and SES has been consistent for the last few days – if possible, avoid going outside and if you do drive, plan ahead – pay attention to RMS message boards for road closures or hazardous conditions, and never drive, ride or walk through floodwater,” NSW Police Deputy Commissioner Gary Worboys said.

“Do not put your life or that of emergency service personnel in danger,” he said.

The Services Australia Disaster Assistance phone lines are open from 8:00am until 8:00pm. The number is 180 22 66 and further details are available at the www.disasterassist.gov.au website.

[Related: LATEST PODCAST: Flood relief and CBA’s new BNPL product]

Lenders offer loan relief for flood victims
Lenders offer loan relief for flood victims
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Annie Kane

Annie Kane is the editor of The Adviser and Mortgage Business.

As well as writing about the Australian broking industry, the mortgage market, financial regulation, fintechs and the wider lending landscape – Annie is also the host of the Elite Broker and In Focus podcasts and The Adviser Live webcasts. 

Contact Annie at: This email address is being protected from spambots. You need JavaScript enabled to view it.

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