If you’re struggling to keep on top of your personal loan repayments, you’re not alone. 

Your bank is ready to listen and consider possible solutions that are right for you.

It’s important to be open and realistic when talking about your financial position.

If you hold multiple loans or finance packages from different credit providers, you should contact each of the providers as well.

When should I talk to my bank?

Don’t be afraid to contact your bank as soon as possible. The sooner you do, the sooner they can help you find a solution that is right for you.

Help to improve your situation

Taking a closer look at your budget could help you to get your finances back on track.

You’ll need to consider your income, expenses, the debt you’re managing and any savings and investments you have. Are there any changes you could make to reduce your expenses and consolidate debts?

Doing this will give you a better understanding of how much you can save, or where you could make cuts in your spending to improve your financial health.

For assistance with budgeting, you could use the online Moneysmart budget planner.

This is a good step to take, as your bank may ask you about your income, expenses and any changes you intend to make when discussing options to assist you.  

Are there better ways to manage your repayments?

Depending on your circumstances, and your bank, there may be ways for you to work through these difficult times and keep repayments on track. These include:

Consolidate multiple loans into a single loan

If you have multiple personal loans and credit cards too, then depending on your situation and bank, you may be able to consolidate your cards or outstanding balance onto a personal loan and pay off the balance with regular instalments.

You may be able to receive relief from repayments

Talk to your bank about your situation and they may be able to arrange a deferral or reduced payments on your personal loan.

Reduced payment arrangements

Talk to your bank about whether you could arrange payments at a reduced interest rate or reduce your minimum repayment amount.  

Your bank may ask for relevant information depending on your circumstances, so they can understand better ways they might be able to help with the potential options available. This may include:

• Proof of income – recent pay slips, profit/loss statement for self-employed, rental income, centre link income, notice of termination and termination payments. 
• Essential expenses – rent/mortgage payments, summary of outstanding bills and credit card statements / loan payments from other financial providers. 

If you have contacted your bank to let them know you are worried about repayments, your bank can ask for relevant information within 21 days of you contacting them. When your bank asks for this information, you must provide it within 21 days.

If your bank doesn’t allow you to change the terms of your loan, they need to tell you why in writing and give you details about where you can complain.

Take care of yourself and seek help 

Please reach out if you feel you are in over your head. You could also contact the National Debt Helpline on 1800 007 007 and speak with a financial counsellor. Financial counsellors are qualified professionals who provide free, independent and confidential information and advice to people in financial difficulty. 

Charities and community organisations can also provide urgent help with food, housing and bills as well as emotional support.

You could also contact Beyond Blue on 1800 512 348 who offer a wellbeing and mental health support service.

If you have debts with multiple banks, Way Forward Debt Solutions may be able to help you manage your debt. 

Moneysmart is another useful resource to help you.