You cannot be sent to prison because you cannot or don’t pay a debt (except for fines because they are penalties).

Fines

You may be tempted to ignore fines in favour of other pressing bills and debts, like your mortgage. But fines are different to other debts because they are penalties imposed by the government for breaking the law. The consequences of not paying them can be serious, like the loss of your drivers’ licence or even imprisonment.

For more information see the Fines page.

Credit Law

The Credit Law applies to credit cards, loans and leases for personal purposes. It also applies to finance and mortgage brokers. Some of the important rights you have under the Credit Law are:

1. Access to fair, timely and effective internal dispute resolution from your creditor
2. Having a dispute about your loan decided in free external dispute resolution if you are unable to resolve it with your creditor
3. A right to request financial hardship and have the decision reviewed and decided in external dispute resolution
4. At least 30 days to fix a default on your loan
5. Being given information about the terms of your loan and access to copies of loan documents and account statements on request
6. Only provide you with credit that is “not unsuitable”. This means that the loan is affordable and it meets your needs.

For more information see any of the following pages:

• Home loans
• Car loans
• Credit cards
• Personal loans

Debt Collection

The Australian Consumer Law and the ASIC Act requires that you’re treated in a fair and reasonable way when you owe a debt. The ACCC/ASIC Debt Collection Guideline is a practical guide to the legislation by the regulators on what can and can’t be done by creditors or debt collectors when collecting a debt. It covers your rights to:

1. Be treated fairly and not be harassed or coerced
2. Make reasonable repayment arrangements
3. Only be contacted at reasonable times and not too often

For more information see the Debt Collection page.

Utilities

You have the right to:

• Apply for and not be refused a reasonable repayment arrangement if you’re struggling to pay your bills
• Notice before disconnection
• Access to free external dispute resolution(in most cases)

For more information see the Electricity Gas and Water Bills page.

Telcos

Your telco must work with you and offer options to help meet your individual circumstances. Some important rights you have are:

• Being given options to help reduce your usage costs
• A right to apply for and be given a suitable hardship payment arrangement
• Being given at least 5 days notice in writing by your provider before they restrict, suspend or disconnect your service
• Access to free external dispute resolution if you can’t reach an agreement with your telco provider

You also have the right to dispute your telco contract if, for example,it is unfair, you were misled by the salesperson, you were pressured or coerced into signing it, you could never afford the payments without hardship.

For more information see the Phone and Internet Bills page.

Payday loans

Payday (short-term, or fast) lenders must not:

1. Provide you with an ‘unsuitable’ loan (i.e. one you can’t afford to pay and/or doesn’t meet your needs)
2. Take security for the loan
3. Charge an amount above the interest/fees cap

You can also access free external dispute resolution.

For more information see the payday loans page.