How one phone call can get an instant reprieve on your council rates

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Millions of Aussies battling higher mortgage interest rates have just – or will shortly – also get council rates notices landing in their letterboxes or inboxes.

It’s likely these notices will also feature big increases, adding further to the rising costs of things like utilities and insurance hitting homeowners presently.

Millions of Aussies battling higher mortgage interest rates have just – or will shortly – also get council rates notices landing in their letterboxes or inboxes.Credit: Simon Schluter

While some states set a “peg” that is supposed to work as a guide for how much they can rise, councils can apply for extra if there is a revenue shortfall.

For example, the peg was set at 3.7 per cent this financial year for councils in NSW, but Tenterfield Shire Council was approved for a 104.5 per cent increase over the next two years.

More than a dozen other NSW local councils also applied for more money to maintain services. In other states, increases of as much as 10 per cent are not uncommon.

But here’s what many people don’t know: wherever you are, however large the bill shock of council rates, you can get a reprieve from them. With one phone call.

This is the script to follow for instant rate relief.

Firstly, vitally, you must pick up the phone to your local council before your rates bill is due. As with all aspects of your financial life that are making you too stretched right now, confessions get concessions.

After you have defaulted, you are in line for a fine or additional interest, but have the below conversation ahead of that, and you should be charged neither fees nor interest.

There is not even a financial loading applied to the far-more-manageable repayment plan for which you should be instantly approved… unlike virtually every other bill or contract in your life that you spread in this way.

Here’s what to say:

You: Hi, I have my council rates in my hand and can’t pay the lump sum. Can anyone help me?

Council customer service: Sure, I can help you with that right away. Confirming that bill was for $xxx. Do you want to pay fortnightly or monthly?

(This is a big question: the fortnightly amount will be less than half of the monthly amount because there are more than double the number of fortnights in six months – just trust me! But your best option is to say:)

You: I’d like to match repayments to my pay cycle please, which is fortnightly/monthly.

Council customer service: When would you like to begin? All that is required is you start before the bill is due and what you owe is fully paid before the next rates bill is due in half a year’s time.

It’s that simple.

So is there a catch? This is not actually a delay pay arrangement – rates are billed in advance of the rate period.

As a result, and unlike with many other more frequent bill repayments or formal financial hardship arrangements, there is no downside.

This doesn’t even qualify as “financial hardship” so will never make it onto your credit record and or hurt your credit score.

As the lovely, notional customer service person explained above, you just need to clear your bill fully before your next rates period begins.

It’s only if you fail to pay off your rates by the end of the rates period that you will pay extra as a penalty.

Indeed, you are not obliged to pay upfront for rates at all and are entirely within your rights to remit the money in a pay-as-you-go tempo that much less stressfully fits your finances.

Nicole Pedersen-McKinnon is the author of How to Get Mortgage-Free Like Me. Follow Nicole on Facebook, Twitter or Instagram.

  • Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.

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