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Consumer rights & money

Chapters in this topic

If things go wrong

Repaying the loan

Problems with making your repayments

You have options if you’re having trouble with your loan. You can call a financial mentoring service, for example, Moneytalks (0800 345 123), or the Consumer Protection’s helpline, (0508 426 678), to talk to someone there about it. You may also be able to apply for a break from your repayments if something unexpected has happened. See below, “Unforeseen hardship: Applying to have the contract terms changed”, and for more information about your options generally, see “Where to go for more support” at the end of this chapter.

What happens if I can’t meet my payment commitments?

It is important to remember that if your circumstances change, call or get in touch with the lender, and let them know you are having trouble making your repayments. If you fail to meet your payment commitments or breach the credit contract in some other way, the lender may be able to repossess goods that you bought on hire purchase or that you put up as security for a loan (see “Repossession” in this chapter).

Note: If you’re not able to meet your payment commitments, you may be able to negotiate another arrangement with the lender – for example, making smaller payments over a longer period. If the debt is unsecured, you may be able to apply for a debt repayment order to enable you to pay the debt back over time and to stop the lender taking court action against you (see “When you can’t pay your debts: Bankruptcy and other options” in this chapter).

Unforeseen hardship: Applying to have the contract terms changed

When you can ask the lender to change your repayment obligations

Credit Contracts and Consumer Finance Act 2003, ss 55, 56, 57A(3)(a), 59A

You can ask the lender to change the terms of the credit contract if:

  • you’re unable to meet your obligations because of some unforeseen hardship, and
  • you can reasonably expect to meet your obligations if the lender changes the contract terms.

Examples of unforeseen hardship are if you’re sick or injured, if you’ve lost your job or if your marriage or relationship has ended.

Changes to the contract can include extending the term of the contract (to reduce the amount of each payment) and postponing certain payments. Interest will continue to run if you extend the term of the contract.

You’ll need to put your request in writing. The lender can’t charge you a fee for dealing with your request.

When you’re not entitled to make a hardship request

Credit Contracts and Consumer Finance Act 2003, s 57; Credit Contracts and Consumer Finance Act 2003, s 55(1B)

In some cases when you’ve already missed a payment, the lender doesn’t have to consider any hardship request you make. This applies if:

  • you’ve been behind on your payments for two months or more, or
  • four times in a row you’ve failed to make your payments on time, or
  • you’re behind two weeks or more after getting a repossession warning notice (see “Repossession” in this chapter).

However, even in those cases the lender must consider your hardship request if you’ve now fixed the problem.

The lender also doesn’t have to consider your request if you could reasonably have been expected to foresee, when you made the contract, that the hardship would prevent you making your payments.

There’s also a restriction on how often you can make hardship requests on the same grounds. If you’ve already made a hardship request to the lender, you can’t make another one within the next four months unless it’s for a different reason.

The lender’s response to your hardship request

Credit Contracts and Consumer Finance Act 2003, s 57A

After they receive your written hardship request, the lender must meet a number of deadlines:

  • They have to give you a written notice acknowledging your request within five working days after receiving it.
  • If they want more information from you, they have to ask for this within 10 working days after your request.
  • The lender must make a decision and notify you of it within 20 working days after your request (or, if they’ve asked for more information, then within 10 working days after getting the information or within 20 working days after asking for the information, whichever is later). The lender must comply with the lender responsibility principles when they decide (see “Responsible lending requirements” in this section). If they refuse your request, they have to give you written reasons for this and must tell you about your right to take the issue to the courts or the Disputes Tribunal.

What can I do if the lender refuses my hardship request?

If the lender refuses your request, you can ask the courts or the Disputes Tribunal to change the terms of the contract (see the chapter, “The Disputes Tribunal”).

You can also take your request to the courts or Disputes Tribunal if the lender does not respond with a decision within the required time (see above).

You can also complain to the lenders dispute resolution scheme if you disagree with the lender’s decision to decline your application for hardship. See “Dispute resolution schemes” in this section.

“Prepayment”: Paying off the debt early

Can I pay off the debt early?

Credit Contracts and Consumer Finance Act 2003, ss 49–54

A lender must accept early or extra payments (also called “part prepayments”) unless the contract says that the lender can refuse them. If a lender refuses an early payment, they must refund that payment to you as soon as practicable.

A lender must accept full repayment at any time, and the contract can’t prevent this.

Note: The lender can charge you a “break fee” if the contract specifically allows this. A break fee – called a “prepayment fee” in the CCCF Act – is a fee you pay if you pay off the credit early. The fee must be a reasonable estimate of the lender’s loss arising from the early payment (see also “Interest and fees” in this section).

If you’re considering early repayment, ask the lender what it will cost to repay early (they may charge you a small fee for working out the figures). Make sure you check whether it’s worth it to repay early. Getting budgeting advice will help.

Applying for an early release of Kiwisaver funds

Can I apply for a release of my KiwiSaver funds for significant financial hardship?

You may be able to withdraw KiwiSaver funds early if you are experiencing significant financial hardship. To apply, contact your KiwiSaver scheme provider and fill out a form to make a hardship withdrawal (or contact Inland Revenue if you’ve been in KiwiSaver for less than two months). If your application is successful, you can only withdraw your contributions and your employer’s contributions. You generally cannot take out any government money that has gone into your KiwiSaver.

Significant hardship only applies when you cannot meet your minimum living expenses like food or shelter and should be considered as a last resort. There are strict criteria to successfully apply for significant hardship and people can generally only get support to meet their minimum living expenses. It is best to avoid applying for an early release of your KiwiSaver funds if you can because you miss out on more money down the loan.

Where can I get advice for my situation?

The MoneyTalks helpline (0800 345 123) gives you access to free financial mentoring and budgeting support. If you are having problems making your repayments you can contact them anonymously via phone, livechat, email or text. You can talk about your options if you are having problems repaying your loan. For more information go to www.moneytalks.co.nz

Did this answer your question?

Credit and debt

Where to go for more support

Community Law


Your local Community Law Centre can provide free initial legal advice and information.

Consumer Protection


Consumer Protection helpline: 0508 426 678 (0508 4 CONSUMER)

Email: cpinfo@mbie.govt.nz

The Consumer Protection website has useful information on a range of consumer topics. Consumer Protection is part of the Ministry of Business, Innovation and Employment (MBIE).



Phone: 0800 345 123

Email: help@moneytalks.co.nz

MoneyTalks provides free, confidential budgeting support. They can pair you with a financial mentor to help you if you are struggling with debt or need advice on budgeting.



Phone: 0800 345 123

Email: kiaora@fincap.org.nz

FinCap can help you with budgeting information online or on the phone. They may also suggest a local budgeting service to help you with debt and other budgeting issues.

Consumer NZ


Phone: 0800 266 786

Email: info@consumer.org.nz

The Consumer NZ website provides a wide range of information on consumer credit and debt issues, including debt collectors, repossession and bankruptcy

Commerce Commission


Phone: 0800 943 600
Email: contact@comcom.govt.nz
The Commerce Commission enforces the consumer credit legislation (the Credit Contracts and Consumer Finance Act) and the laws against misleading and deceptive conduct by traders (the Fair Trading Act). The Commission provides information on these areas on its website.

It’s All Good


It’s All Good is an animated series produced by The Commerce Commission about consumer rights.

Citizens Advice


Phone: 0800 FOR CAB (0800 367 222)
Citizens Advice Bureaux have volunteers trained in consumer law who can provide information and advice if you have a problem with credit and debt issues.

Dispute resolution schemes

There are four dispute resolution schemes for consumers dealing with lenders and other credit providers.

  • Financial Services Complaints Limited – www.fscl.org.nz
    0800 347 257
  • Email: info@fscl.org.nz
  • Insurance & Financial Services Ombudsman –
    Phone: 0800 888 202
  • Email: info@ifso.nz
  • Banking Ombudsman – www.bankomb.org.nz
    0800 805 950
  • Email: help@bankomb.org.nz
  • Financial Dispute Resolution – www.fdrs.org.nz Phone: 0508 337 337
  • Email: enquiries@fdrs.org.nz

Cases in the District Courts

The Ministry of Justice

The Ministry of Justice website has information about civil claims in the District Courts: see www.justice.govt.nz and search “Claims you can take to civil court”.

Credit reporting

Privacy Commission

0800 803 909

The Privacy Commission has information on your rights in relation to credit reporting and how to complain if you feel your rights have been breached.

Your credit record

Three credit reporting companies operate nationally in New Zealand. To check your record or correct any information, you’ll need to contact them all.

You’re entitled to a free copy of your credit record. You should make sure you choose the free option when you contact each company.

Centrix – www.centrix.co.nz 0800 236 874

Illion – www.illion.co.nz 0800 733 707

Equifax – www.equifax.co.nz 0800 698 332

Personal Properties Securities Register (PPSR)


Search the PPSR register to see if there is any security interest registered against a vehicle. This can be done for a small fee by registering to check online.

Bankruptcy and other options

Insolvency and Trustee Service


Phone: 0508 INSOLVENCY (0508 467 658)

The Insolvency and Trustee Service (ITS) deals with bankruptcies, no-asset procedures, summary instalment orders and some company liquidations. Information about those processes is available on its website. The ITS is part of the Ministry of Business, Innovation and Employment (MBIE).

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