Australian debt guide
How to propose a debt collector payment plan
By DebtReply · Sources checked
ASIC’s Moneysmart recommends checking income and expenses before proposing an affordable payment plan, then asking for the agreement in writing. An offer is not an accepted arrangement, and an average budget can hide difficult payment dates. Prepare your figures and ask the collector to explain the complete proposed terms.
How do I choose a proposed amount?
Moneysmart recommends listing income and outgoings. The private budget worksheet converts weekly, fortnightly, monthly and annual figures to a monthly average. It displays the difference and leaves the decision to you. Check actual bill dates too: an average can hide a difficult week.
What should the letter ask for?
Our payment-offer letter sets out your proposed amount, frequency and first date. It asks for the balance, payment method, treatment of interest and fees, and a review point. Compare the written response with your proposal line by line. If anything differs, put the question in writing before assuming it has been agreed.
What if the plan stops being manageable?
Moneysmart’s hardship guidance recommends contacting the provider when an arrangement becomes difficult. Keep a note of the change and ask about assistance. If the balance itself is disputed or old, get advice about that issue before choosing a payment proposal.
What can I do next?
- List your regular and irregular costs.
- Check the payment dates against your income dates.
- Enter your own proposed amount in the builder.
- Ask for written confirmation of the complete terms.
- Keep the agreement and payment records together.
Example: checking dates as well as averages
This is a planning example, not a suggested repayment amount. You are paid fortnightly but a large bill falls monthly. A monthly average may look manageable while the week containing that bill is tight. List the actual income dates and known bill dates beside the proposed payment schedule. Mark any cost you have not yet included rather than treating a blank field as zero.
Our worksheet converts frequencies to help you organise figures. It does not see your bank account, check that expenses are complete or reserve money for a payment. The Moneysmart debt-management guide recommends looking at income and outgoings across your finances. If you cannot see how a proposal fits, take the worksheet to a financial counsellor rather than lowering essential costs on paper to produce a convenient answer.
Compare the proposed terms
After you send your own offer, compare the reply with these points:
- The proposed amount and how often it would be paid.
- The first payment date and any review date.
- The balance being discussed and the treatment of interest or fees.
- The payment method and what to do if your circumstances change.
These are questions to resolve, not a checklist that makes an agreement suitable. A response agreeing to one point may leave another open. Save the complete written terms and ask for an explanation of anything that does not match your request.
If the proposal is not manageable
Keep the response, your original offer and the budget you used. Identify whether the problem is the amount, timing or another term. Moneysmart's hardship guide recommends contacting the lender when an arrangement becomes difficult. You can also seek free financial counselling. DebtReply does not negotiate with the collector or guarantee that a revised proposal will be accepted.
Put your next step into words
Use a free starting-point letter, then check that every detail fits your situation.
Write the letterCommon questions
Does the worksheet choose an offer for me?
No. It shows arithmetic from your entries and does not recommend a payment.
Does downloading the letter set up payments?
No. DebtReply does not create a payment arrangement, direct debit or transaction.
Can I offer weekly or fortnightly payments?
The letter builder supports weekly, fortnightly and monthly proposals. The recipient still needs to respond to your proposal.
Sources you can check
- Get debt under control ASIC Moneysmart · Checked 18 October 2026
- Dealing with debt collectors ASIC Moneysmart · Checked 18 October 2026
- Financial hardship ASIC Moneysmart · Checked 18 October 2026
This guide explains a process. It has not been reviewed as advice for your situation. How we use sources.