Take time before you sign any credit contract or loan agreement. It’s important to understand fees and charges, interest, your payment obligations, and what to do if you are behind in payments. MoneyTalks is a free helpline providing budgeting advice for individuals, family and whānau. Contact 0800 345 123 to talk to a trained Financial Mentor.
A rushed decision can be costly when borrowing money. It’s good to ask: “do I need to borrow the money?” Loans, and the paperwork that go with them, can be confusing. Make sure you ask questions about what you are agreeing to and what your payment obligations are.
You can use the Sorted debt calculator to work out what the loan will cost each month and in total: www.sorted.org.nz. It’s also a good idea to talk to a Financial Mentor about your budget and how a loan will impact on your finances. MoneyTalks provides free budgeting advice to individuals, family and whānau. Contact 0800 345 123 to talk to a trained Financial Mentor.
All loans will have fees and charges. Ask the lender to clarify all fees and charges over the full repayment period. The documents the lender provides should show these clearly. There can be break fees (penalties for paying off the loan early), fees for missing payments and administration fees.
As soon as you have an issue with the loan repayments, get in touch with your lender and discuss it with them. Lenders may allow you to extend the time or restructure your obligations to make them more manageable. MoneyTalks provides free budgeting advice. Contact: 0800 345 123
The Credit Contracts and Consumer Finance Act (CCCFA) requires lenders to act responsibly, and ensures borrowers are able to make informed choices about what they are agreeing to. The Responsible Lending Code further explains lender responsibilities.
Write to your provider to ask for copies of statements showing payments and any fees or interest which has been applied. You should then check these statements to make sure you understand any fees or interest and that they record all payments you have made. If you need any help with this, your local Budgeting service or Citizens Advice Bureau may be able to assist you.
If you have any problems getting this information or disagree with the statements, make a complaint to your provider.
Contact your provider and explain your situation. You may be able to ask for a payment holiday.
You could also contact your local Budgeting service who provide free, independent and confidential assistance and can work with you to put together a repayment plan.
Check your loan agreement to see what interest rates you agreed to when you took out the loan. If you need any help calculating what the payments should be, contact Money Talks: moneytalks.co.nz
If you want to make a complaint, first make a complaint to your provider or call us on 0800 888 202 and we can help you with next steps.
The following sites may be helpful for further information or budgeting advice.
Money Talks: https://www.moneytalks.co.nz/
FinCap: https://www.fincap.org.nz/
Commission for Financial Capability: https://ccfc.org.nz
CAB: https://www.cab.org.nz/