Lender changed their mind about a declined hardship request

Ben fell into arrears on his personal loan when his partner had to stop working due to a medical condition. Ben suddenly and unexpectedly became the family’s sole income earner.

Ben told the lender he could afford his regular loan repayments, but he could not afford to clear the arrears of around $2,900. He wanted the lender to consolidate the arrears into his loan.

Ben complained to the lender around two weeks later because they had not told him whether they were going to offer hardship assistance.

The lender eventually told Ben they would not provide hardship assistance. They said they had previously provided hardship assistance and could not do anything further to assist him. It appeared the lender was referring to various forms of hardship assistance they had previously given Ben for an unrelated event.

Ben complained to FSCL about the lender’s decision to decline further hardship assistance.


Ben believed the lender’s decision was unfair. The family’s loss of income was sudden and it had put them under financial pressure. Ben was committed to making his usual repayments but he needed help with the arrears.


The lender decided to reconsider hardship assistance. They asked for an updated statement of financial position from Ben. Once they had reviewed this, they decided to agree to Ben’s request to consolidate the loan arrears.

The arrears were added to Ben’s loan and the loan term was extended by 10 months. This meant that Ben would pay more interest over the term of the loan, but he was happy to agree to this to clear the arrears.

Insights for consumers and participants

A borrower can ask their lender for help with their loan if they are suffering unforeseen hardship.

A lender does not have to agree to a borrower’s hardship request, but they must comply with the lender responsibility principles set out in the Credit Contracts and Consumer Finance Act 2003. The principles include treating a borrower in an ethical manner when the borrower suffers unforeseen hardship.

There is no limit on how many times a borrower can request hardship assistance. However, a borrower can only make one hardship application on the same grounds within any four-month period, unless the lender agrees to consider another application.