Recognise the warning signs
Repeatedly using savings or credit for ordinary bills, falling behind on utilities, or relying on a card for mortgage repayments can signal that the current payment is no longer sustainable. Start with a realistic cash-flow view rather than waiting for arrears.
Contact the lender early
A lender's hardship team may discuss temporary arrangements based on the circumstances. Any arrangement can affect the loan and total interest, so ask for the terms in writing and understand what happens when it ends.
Get independent support
Free financial counsellors can help assess options and speak with creditors. Urgent legal or housing concerns require qualified advice; a new loan is not always the safest response to financial stress.
Key points
- Act before a repayment is missed
- Ask the lender about hardship options
- Use a realistic household budget
- Seek free independent financial counselling
Frequently asked questions
Will asking for hardship automatically damage my credit file?
The treatment depends on the arrangement and reporting rules. Ask the lender how the proposed arrangement will be recorded before agreeing.
Should I refinance while under stress?
Refinancing may help in some cases, but fees, a longer term or a declined application can make matters worse. Compare the total effect carefully.