Where you are unable to meet your repayments to your credit obligations, you may be experiencing financial difficulty. Financial difficulty may relate to your credit card, home loan, personal loan or business loan. The Australian Financial Complaints Authority (AFCA) can deal with financial difficulty relating to a range of credit products and services.
If your financial difficulty relates to another type of financial product or service, we may also be able to assist you.
The causes of financial difficulty can include sickness, natural disaster, unemployment or over-commitment. Both consumers and small businesses can experience financial difficulty.
AFCA uses a streamlined process for complaints about financial difficulty in repaying credit obligations to ensure these are dealt with in an efficient, timely and fair manner. Financial difficulty complaints will be identified as soon as possible after we receive them.
If you are experiencing financial difficulty, we encourage you to contact your credit provider to discuss a hardship arrangement. If you are unable to come to a suitable arrangement, please contact us.
Examples of financial difficulty include where your financial firm has declined or not responded to your request to vary your repayments due to hardship, you have been issued a default notice, or your financial firm is continuing legal or debt collection action against you after you have made a financial difficulty request to them.
If you are in financial difficulty and you and your financial firm can’t agree on an arrangement that suits you both to repay your debt, AFCA may be able to consider a complaint about your situation.
First, you will need to make a complaint to us.
When you make a complaint to us, we will ask you to tell us about your financial position and how you plan to repay the debt.
We expect your financial firm to work with you and try to assist you to overcome your financial difficulty. In most cases, we will try to resolve your complaint through negotiation or conciliation.
AFCA can consider issues related to financial difficulty, including:
After reviewing your financial firm’s response to your request for financial difficulty assistance, we will decide whether a conciliation conference is appropriate, which are mostly conducted by telephone.
If AFCA decides that a conciliation conference is appropriate, we will arrange the conference. Before a conciliation conference, we may ask the parties to provide information that has not previously been provided. This may, for example, include details of your financial position including your income and expenses, details of the debt and arrears and the estimated value of any security such as a property.
Where a conciliation conference is conducted, it is compulsory for both the financial firm and the person making the compliant to attend. You may also have an authorised representative (an agent) attend. It’s important to know that the people who attend the conciliation conference must have authority to settle the complaint and agree on the outcome at the conference.
If a complaint is not resolved at a conciliation conference or we decide that a conciliation conference is not appropriate for a complaint, then we can proceed to decide the complaint.
Financial counsellors provide their services free of charge and can talk with you about what options might be available to you. You can call lthe National Debt Helpline on 1800 007 007 to speak to a financial counsellor. The National Debt Helpline website also has step-by-step guides on how to tackle financial problems.
An important step in overcoming your financial difficulty is to get an understanding of your financial position and how much you can afford to pay towards your debts. To help with this, complete a Statement of Financial Position including details of your income, expenses and debts you owe your financial firm and other financial institutions. If you need help to do this, we encourage you to contact a financial counsellor.
Contact your financial firm and tell them about your situation. Hardship contact details for your financial firm will be on their website, or you can look for their contact details using our online member look up facility. Ask your financial firm if they have a dedicated financial hardship customer representative that you can speak to. You may be able to come to an arrangement with your financial firm that will help you get back on track.
It is important that you make whatever payments you can, even if your financial firm has not yet agreed to an arrangement. This is because interest will usually continue to accrue, and if you do not make payments your situation could get worse.