The Victorian government has unveiled a $4 million budget boost to expand Mortgage Stress Victoria’s free support for at‑risk home owners.
The Victorian Labor government will inject $4 million into Mortgage Stress Victoria in the 2025–26 state budget, expanding the scope of the free legal and financial counselling service as higher interest rates and cost‑of‑living pressures continue to squeeze borrowers.
From 1 May, households earning up to $90,000 a year will be eligible for Mortgage Stress Victoria’s free support, with the government lifting the income threshold from $75,000, allowing more middle‑income borrowers access to advice and representation.
The service brings together lawyers, social workers, and financial counsellors to help owner‑occupiers at any point along the stress curve, from early worries about meeting repayments to court orders for repossession.
The program first began as a pilot in Melbourne’s western suburbs and has operated statewide since 2022.
The government credited previous funding rounds with preventing hundreds of forced sales.
Announcing the fresh funding during a visit to the service on Wednesday (11 March), Consumer Affairs Minister Nick Staikos linked the move directly to the increasingly uncertain interest‑rate environment.
“With the RBA’s cash rate decisions putting pressure on household budgets, services like this have never been more important for Victorian families,” he said.
Funding positioned as frontline cost‑of‑living support
Staikos underscored the program’s role in keeping borrowers in their homes and preventing them from dealing with the social and financial fallout of foreclosure.
“Mortgage Stress Victoria provides a vital role in helping Victorians stay in their homes and avoid the devastating impact of mortgage stress,” he said.
The government also framed the initiative as part of broader cost‑of‑living packages targeted at households under strain from higher repayments.
“As well as direct mortgage stress support, the Labor Government is providing real support where it’s needed most while investing in the frontline services families rely on,” Staikos said.
He pointed to recent measures that sat alongside the mortgage package in the 2025–26 budget, including free public transport for children, a $100 power saving bonus, and caps on fuel price increases.
“We will always be in the corner of Victorians doing it tough,” Staikos said.
For brokers and lenders, the expanded service means more clients on moderate incomes will have access to independent advice and advocacy if rising mortgage costs push them into difficulty, potentially shaping hardship negotiations and refinance decisions.
[Related: Three-quarters of mortgagors say their financial health has improved]
