Winning Solution

March 25, 2017

We understand consumers need money to survive but how to use money has become an important issue. Failing to prioritize needs has resulted in many consumers falling into the vicious cycle of debt. If you are in this situation and do not know what to do, then you can learn from Vaisiti’s case study given below.

Vasiti was employed under a donor funded project. Vasiti was advised verbally by her employers, prior to the end of her contracted period, that the special project she was employed under would continue only if the organization could secure further funding. There was also a provision in her contract of employment to that effect. Vasiti, knowing that her employment was insecure and having heard of the Council’s Debt Management programme from her friend, approached the Council a few times to seek advice from us on how she could deal with her mortgage repayments, as she was nearing the end of her employment contract.

The Council advised her that she had two options. She could, as provided in the Consumer Credit Act 1999, apply for an account restructure with her bank on the grounds of hardship as she looked for alternative employment; and/or she could apply for unemployment assistance through the Fiji National Provident Fund to continue with her repayments as she looked for another job.

Vasiti advised the Council that she was already well above the retirement age therefore she would not be able to apply for the unemployment assistance and that she had already opted for her full pension payout from FNPF, years earlier. Her prospects of being reemployed, given her age, were rather slim and her unemployed husband was also a retiree. In addition, one of her sons with his wife and children lived with her and were dependent on her. Her three other children were all employed married and had homes of their own.

Given her situation, the Council advised her either to try to start her own small business by sellingfood or any other crafts she could produce, or alternatively request her children for some form ofassistance. She was keen on the first idea and insisted that requesting her children to assist wouldbe a last resort as she did not want to put them under financial stress.

Despite her understanding of her children’s own financial obligation, unfortunately, she had totake assistance from them to help with her mortgage repayments. Her two daughters were willingto pay a collective amount of $500 monthly (as opposed to Vasiti’s $800.00 monthly repayment)as they had their own personal expenses to meet. Vasiti maintained a good credit record. Hermortgage account was not in arrears and she had a healthy repayment history with her bank. Shealso had no other debts with any other credit institutions or money lenders. Her main expenseswere her monthly utility bills and grocery shopping.

The Council then contacted the bank concerned and requested a restructure of her mortgage loangiven the hardship she was currently facing. After continuous deliberations between the Counciland the bank concerned and between Vasiti and her children, Vasiti opted for the following:

  • Vasiti agreed to keep her monthly repayments at $800 with the bank so she could reduceher balance quickly. Her daughters would continue to pay $500 towards her mortgageaccount as they agreed.
  • Vasiti would start her own food selling business and involve her dependent son and hisfamily at home in the venture. This would ensure that her family’s main expenses wouldbe met, i.e. food and utility bills, and also that she could meet her $300 as the balance forher mortgage monthly repayments. Her children would assist in the startup capital for thebusiness and they agreed to trial-run the business for 3–6 months.
  • The bank agreed to the plan and will consider the request to restructure her account andreduce her monthly repayments should the business trial not go according to plan.

Three months after Vasiti informed the Council that her catering business is going according to plan.She is able to meet her repayments to the bank along with her other expenses, as per the plan.

The Council urges other consumers, struggling with debt situations, to come forward and seekprofessional advice from the Council.

The Council continues advising consumers on their rights and responsibilities. If consumers need Council’s assistance then they can visit our offices in Suva, Lautoka and Labasa or call our National Consumers Helpline on toll free number 155 for advice.