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. 

AFCA's approach to financial difficulty

Are you in financial difficulty?

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. 

When you can make a complaint to AFCA 

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. 

Make a complaint

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.

Complete a statement of financial position

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.  

Issues that we can consider about financial difficulty

AFCA can consider issues related to financial difficulty, including:  

  • If your financial firm has declined your financial difficulty request: For example, if you have asked your financial firm for assistance and that request (such as a repayment variation) is declined and no offer is made by the financial firm – or where the financial firm has not provided reasons for its decision to decline a request for assistance. 
  • Default notice: Your financial firm has sent you a default notice when you are experiencing financial difficulty (regardless of whether you have requested assistance or not). 
  • If your financial firm has failed to respond to your request for assistance: If your financial firm fails to respond to your request for assistance due to your financial difficulty (note that your request may be actual or implied). 
  • Request to suspend enforcement proceedings: Where the financial firm continues action against you to recover a debt after you have made a financial difficulty request. For example, if they continue or start legal proceedings, or if they start or continue a general recovery action, such as taking secured property or inappropriate debt collection activity (including if you’re being contacted by debt collectors after you have made a financial difficulty request).  
  • You have received a default court judgment in relation to a debt with a financial firm: If you have received a default judgment in relation to an outstanding debt with a financial firm and the firm has declined your request for assistance in repaying the judgment debt, we may be able to assist you in specific circumstances. 

What happens after you make a complaint

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. 

More information

Other steps you can take to help manage your situation

Talk to a financial counsellor

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. 

Complete a Statement of Financial Position

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. 

Talk to your financial firm

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. 

Make payments if you can

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. 

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