If your credit or loan repayments are getting out of control, talk to your lender about your options. Taking action straight away can stop a small problem from becoming a big one.
Here are some practical steps you can take to get your finances back on track.
If you're in crisis and struggling to pay for essentials, there are services to help you with food, bills and housing. See urgent help with money.
1. Ask your lender for financial hardship assistance
The first step is to contact your lender's hardship team. Search for ‘hardship’ on your lender's website or:
- to find contact details for your bank, go to the Australian Banking Association’s financial assistance hub
- to find your credit union, mutual bank or building society, go to the Customer Owned Banking Association’s member page
You can reach out to your lender by phone, email or chat.
When you ask for help, your lender must consider you for hardship assistance.
2. Explain your situation
When you request financial hardship assistance, your lender may ask you for information such as:
- the reason you are experiencing hardship
- your current income and other major financial expenses, such as other loans
- what repayments you can afford
3. Consider financial hardship options
Your lender's hardship team will assess your situation and work out what help is available.
Options can include setting up a payment plan or altering your loan repayments. This is called a 'financial hardship arrangement'. Your arrangement may be temporary, like deferring a payment. Or permanent, like varying a loan.
You may be concerned about how a financial hardship arrangement will affect your credit score. It won't affect your credit score. Your credit report will show you have an arrangement in place, without saying why. As long as you keep up with your agreed new payments, you're shown as up-to-date. The listing is deleted after 12 months. To find out more, see credit scores and credit reports.
4. Make your financial hardship arrangement
When altering your loan repayments or negotiating a payment plan, only agree to an amount you can afford to pay. If you're not sure how much you can afford, use the budget planner.
If you find you can't stick to the new arrangement, tell your lender straight away. Keep paying what you can, even if it is not as much as you agreed to. Then negotiate a new arrangement you can afford.
Your lender must give reasons if they refuse your request for hardship assistance. If you're not happy with their response, you can complain.
5. Get more help if you need it
Talk to a financial counsellor
If you need help applying for financial hardship, contact a financial counsellor. This is a free and confidential service.
Call the National Debt Helpline on 1800 007 007 to talk to a financial counsellor.Monday to Friday, 9:30am to 4:30pm. Or live chat, Monday to Friday, 9:00am to 8:00pm.
Aboriginal and Torres Strait Islander peoples can call the free Mob Strong Debt Helpline on 1800 808 488. Monday to Friday, 9:30am to 4:30pm.
Get debt management support
Call Way Forward on 1300 045 502. Monday to Friday, 9:00am to 7:00pm. If you're in financial hardship, they can arrange a debt repayment plan on your behalf. This is a free service.
Get mental health or emotional support
Call Beyond Blue on 1300 22 46 36, 24 hours a day. Or live chat, 24 hours a day.
