Debt relief

If you lose your job, how will you pay your bills? CHOICE outlines your options.
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05.Your rights and contacts

Your rights under the consumer code

Many people spiral into debt through circumstances beyond their control, such as losing their job, family breakdown or illness, without realising they may have been able to renegotiate their debts. The key is to act immediately; the Uniform Consumer Credit Code allows you to make an application for a hardship variation of your loan in case of temporary financial difficulties.

If your lender is a bank, Section 25 of the Code of Banking Practice will also apply, which states: ”We will try to help you overcome your financial difficulties with any credit facility you have with us. We could, for example, work with you to develop a repayment plan.” It’s important to let your lender know about your situation. Bankruptcy trustee Andrew Aravanis has seen many people, who underwent hardship some years earlier, try to maintain their situation by applying for more and more credit cards, which they use to service their mortgage and other debts. After exhausting all their borrowing opportunities their only option now is bankruptcy.

You need to give the lender information about your financial situation and apply for temporary relief, such as reducing your minimum repayments and/or waiving fees or even interest. Offer what you can afford and make sure you can still cover your living costs and any other debts. It’s up to your lender to assess your application, but all should have their procedures in place.

Raj Venga, Credit Ombudsman, has also seen some showing compassion: “One lender reduced the interest rate by 3% for six months.” If your lender refuses the application, complain to the Credit or Financial Ombudsman Service – both services are free for consumers. You can also have your case considered by the relevant state tribunal or court.

Debt relief contacts

Financial counsellors




  • Anglicare, 08 8948 2700 (Alice Springs) or 08 8985 0000 (Darwin)




  • Anglicare, 03 6234 3510 or 1800 243 232



Useful websites

Thank you

For their help with this article we’d like to thank:

  • Richard Brading, Principal Solicitor of Wesley Community Legal Service in Sydney
  • Philip Field, Ombudsman – Banking & Finance at the Financial Ombudsman Service
  • Anna Mandoki, Financial Counsellor with Melbourne’s Inner South Community Health Service

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