If you need help managing debt, there are options out there for you.
If you‘re finding it difficult to keep up with your loan repayments due to issues related to illness, unemployment or changes to your circumstances, there are options out there to help you manage your debt.
What should I do if I can’t pay back a loan?
Finance lenders for mortgages, car loans, personal loans and credit cards are required under the Consumer Credit Law to consider flexible payment arrangements to your loan if you are experiencing financial hardship.
Lenders have Hardship Assistance programs and teams in place to support and help out their customers when in need. You should contact your lender as soon as you can; the earlier you get in touch, the more options you'll have in setting up a Hardship Assistance plan.
Could a Hardship Assistance plan be right for me?
Your lender will work with you to understand your financial situation, and whether a Hardship Assistance plan is the right option for you. Assistance plans can be implemented in a few different ways including:
- Pausing repayments
- Reduction in repayments
- Pausing interest accrual
- Reducing interest rates
Depending on which option is right for you, you’ll submit an application detailing your situation. Your lender is required by law to get in touch with you within 21-days of your application to let you know the outcome of your request.
Who should I talk to if I’m experiencing financial hardship?
You should get in touch with your lender directly. They’ll be best placed to direct you to the information you need.
You can also call the National Debt Hotline on 1800 007 007 for a confidential discussion. The helpline is a not-for-profit service that offers free financial counselling from Monday to Friday, 9:30 am to 4:30 pm.
What can I do if my Hardship Assistance application is refused?
If your lender refuses your application, they must give you a valid and reasonable explanation as to why. If you’re not happy with their response, you can go directly to the lender or to the Australian Financial Complaints Authority (AFCA) to submit a complaint.