When your lender gives you time to sell your house or car
This explanation applies to you if:
- You and your lender agree you can’t afford your home or car loan.
- You plan to sell your house or car to repay your debt.
- Your lender agrees to give you time to sell, and tells you that they will treat this as a financial hardship arrangement.
Summary:
- If your lender tells you that they will treat this as a financial hardship arrangement, it can help protect your credit report.
- While you’re selling your house or car, your repayment history will show as up-to-date (as long as you meet your adjusted obligations).
- The financial hardship information will appear next to your repayment history for 12 months, then come off your report.
- This information can’t be used to calculate your credit score, and it doesn’t stop you from applying for credit in the future.
- Keep your lender informed of your progress with the sale. If the sale doesn’t pay off the full debt, you’ll need to arrange repayment of the leftover debt.
What does “time to sell” mean?
If your situation changes and you can no longer afford your home or car loan repayments, your lender may agree to give you time to sell the asset yourself. This can help:
- Avoid additional default fees and interest.
- Put you in control of selling your home or car.
If the agreed "time to sell" period is treated as a financial hardship arrangement, your credit report will reflect what you're expected to pay under the arrangement:
- If your repayments are reduced and you make them on time, your repayment history will appear up-to-date (i.e.,
or 
). - If you’re not required to make repayments during this time, your history will also appear up-to-date.
In some cases, a lender may not treat the arrangement as financial hardship. For example, if you’ve previously promised to sell but haven’t, or if they don’t believe you’re experiencing financial hardship.
Easy English Read Available
CreditSmart provides an easy english document on this topic to explain it in simple english language.
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What is Easy English?
Easy English is a style of writing that has been developed to provide understandable and concise information for people with low English literacy. Many people find it hard to read and understand everyday written information. Easy English is similar to plain language in that it's concise and easy to understand, but it also follows specific grammatical rules and includes images to support key messages.Each Easy English document will:
- Explain one idea per sentence
- Use basic language and grammar
- Use subheadings, bullet points and white space to break up text
- Use a simple font, layout and design
- Select images that are easily understood and add meaning to the text
What is a credit report?
A credit report is a record of your credit history. It includes:
- personal information to identify you,
- information about loans and other credit you have opened or applied for,
- a month-by-month repayment history,
- financial hardship information if you've agreed to a financial hardship arrangement.
What is “financial hardship information"?
Financial hardship assistance is recorded on your credit report as financial hardship information.
A time to sell arrangement is usually shown as an 
together with your repayment history (unless your lender has told you otherwise).
If you have agreed to a time to sell arrangement with your lender, as long as you make the agreed repayments on time, the repayment history will show you are up to date (i.e., or and include an ).
reflects a temporary change and will be shown once in the month that the loan was varied.
What is a repayment history?
A repayment history is a 24 month view of how you manage and pay your loan and credit accounts:
or means you are up-to-date with repayments (and mean the same thing)
to 
indicates how many months your repayments have been overdue
means repayments are 7 or more months overdue
A good repayment history can help when you apply for credit in the future.
If you've missed a repayment, restarting your payments and getting back up to date as soon as you can will help improve your credit report. Repayment history stays on your credit report for 24 months.
EXAMPLE 1
Kye struggles to pay his home loan for several months after a drop in income and rising living costs. By March 2025, he is three repayments (3) behind and his lender is preparing to take legal action to recover the debt. Kye realises he can’t afford to keep his home, so he tells his lender he plans to sell it. His lender agrees to give him time to sell and sets up a temporary financial hardship arrangement.
As long as Kye makes his reduced repayments on time, his repayment history will appear as up to date (shown by a or ) under the financial hardship arrangement. When the house sells in June and the debt is repaid in full, his credit report will show the loan as up to date and closed. No further information will appear on his credit report after that point.
Will I be able to apply for credit in the future?
Yes. Choosing to sell your house or car when you can’t afford the debt can help protect your credit report and avoid defaults or court judgments. Provided you can afford more credit in the future, this makes it easier to apply successfully.
Keep in mind — if the sale doesn’t repay the full debt, you’ll need to make further arrangements with your lender.
Financial hardship information on your credit report does not prevent you from applying for credit. It simply helps show that you worked with your lender to resolve the situation responsibly.
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