Financial hardship application overturned

In 2017 Vania was working in a well-paid professional job. She borrowed $18,000 from a finance company to buy a car, agreeing to repay the loan over 3 and half years paying $109 a week. On her income at the time, Vania could easily afford the payments.

In late 2018, Vania slipped and fell from a ladder, suffering a serious brain injury. She was no longer able to work and became an ACC beneficiary.

Vania was struggling financially and submitted a hardship application to her finance company. The finance company agreed to reduce her payments from $109 a week to $80 a week for six months. It was agreed that after the six months ended, the payments would increase to $131 a week so that Vania would be able to repay the loan within the same term. When reaching this agreement with the finance company, Vania believed she would be back at work in six months.

When the six months ended, Vania was still unable to work and went to a financial mentor for help. The financial mentor asked the finance company to extend the $80 weekly payments until the loan was fully repaid, but the finance company declined.

The financial mentor felt the finance company was being unreasonable and complained to FSCL on Vania’s behalf.

 

Review

We referred the complaint to the financial company’s internal complaints process. The finance company reviewed its position and agreed to Vania and the financial mentor’s suggestion that Vania could repay the loan at $80 a week and to extend the term of the loan until the debt was repaid.

 

Resolution

Vania accepted the offer, and the complaint was resolved on this basis.

 

Insights for consumers

Sometimes we can help have a financial hardship application reviewed by referring an application to the lender’s internal complaints process, resulting in a quick resolution to the problem.

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