What can I do now? - Mortgage stress

Mortgage stress logoIf the lender has obtained judgment from a court, it is too late to raise a dispute or make a hardship variation application to an External Dispute Resolution scheme. 

You still have some options but you need to be clear about what you want to achieve.

  • Do you want to try and negotiate a repayment arrangement with your lender?
  • Do you want to move out as soon as possible?
  • Do you want more time:
    • to sell your home privately?
    • to move out of your home?
    • to try to refinance your loan?

Making repayment arrangements after judgment

After the lender has obtained judgment, you can still try to negotiate with the lender to let you stay in your home and repay the judgment debt. If the lender agrees, make sure the details are confirmed in writing.

If you don't stick to the repayment arrangement, the lender can immediately apply for orders to enforce the judgment and repossess your home even if you are only a day late or a dollar short making a repayment.

Can I get a default judgment set aside?

If you did not lodge a Memorandum of Appearance and the lender was given a default judgment against you, it may be possible to have the judgment set aside. You should only do this if you:

  • dispute the amount of the judgment or have an arguable defence to the lender's claim, and
  • have a good reason why you did not file a Memorandum of Appearance before the lender obtained judgment.

You should get legal advice straight away and before you make any application to the court. There are significant costs associated with applying to set aside or vary a default judgment. 

What if my house is already on the market?

If you need more time to sell your home, ask the lender to wait before they enforce the judgment. 


If you are unable to pay your debts and cannot come to suitable repayment arrangements with your creditors, you may voluntarily apply to become bankrupt. In certain cases, creditors can also apply to the court to make you bankrupt.

Bankruptcy is a legal process that releases you from most of your debts. It can provide a fresh start, but it also has negative consequences for your future.

You can get more information about bankruptcy from the Australian Financial Security Authority. You should always get advice before declaring bankruptcy.


The information displayed on this page is provided for information purposes only and does not constitute legal advice. If you have a legal problem, you should see a lawyer. Legal Aid Western Australia aims to provide information that is accurate, however does not accept responsibility for any errors or omissions in the information provided on this page or incorporated into it by reference.