The Debt Counselling Process
Debt Counselling offers a remedy to over indebtedness that has the aim at rehabilitation into the credit market.
Debt Review will protect the consumer from losing his assets and keep the Credit Providers from taking legal action on accounts that was lawfully included in the debt review. Any consumer can apply for debt counselling, upon which an assessment will be done to determine the state of over indebtedness. If a consumer is found to be over indebted, the Debt Counsellor will notify all Creditors and negotiate with them in an effort to get the term of each credit agreement lengthened and/or the instalment reduced. In many cases the Credit Providers even agree to a reduced interest rate.
All monthly debt obligations will then be consolidated into one monthly instalment that will cover all obligations under the debt review.
Should all Credit Providers agree to the proposed debt re-arrangement, the Debt Counsellor will file an application with the Magistrate's Court to obtain a consent order which will then enforce the agreed debt re-arrangement.
Should a situation arise where not all of the Credit Providers agree to the proposed terms of the debt re-arrangement, the Debt Counsellor will file an application with the Magistrate's court in an attempt to get a court ruling on the proposed terms of the debt re-arrangement.
The consumer will then make monthly payments according to the debt re-arrangement until balances have been settled or if the consumer are able to continue with payments at the original contracted rates and instalments.
As soon as the consumer has settled all obligations in terms of the debt review, the debt counsellor may issue a clearance certificate, indicating that the consumer is now rehabilitated.
Provide details of your income, monthly budget and debt commitments to the Debt Counsellor. You will need copies of your pay slip, ID and the latest statement of all your debt.
An initial assessment will be done to check that you are over indebted. The Debt Counsellor will verify your budget and your existing debt commitments. A new budget will be agreed and the amount available for debt repayment will be determined. The Debt Counsellor will also provide you with details of all the costs as well as an interim repayment plan. this is when you officially apply for Debt Counselling.
The Debt Counsellor will contact all your Credit Providers via email as per NCR, as well as the Credit Bureaus to verify your debt. You will also be listed on the Credit Bereaus that you are under debt counselling (it is not a judgement). This listing will stay there until you have paid everything off, or until you decided to withdraw, then it will be completely removed. The Debt Counsellor will, where possible, negotiate a proposal with all your Credit Providers.
The Credit Providers may accept the proposals and if all of them do then a Consent Order will be obtained from a Magistrate Court. If one or more of the Credit Providers do not accept the proposed repayment plan the Debt Counsellor will submit a proposal to the Magistrate for a decision.
The Debt Counsellor will provide you with a final repayment plan and this repayment plan is also submitted to a Payment Distribution Agency (PDA). The aim of this is to collect a single payment from you and ensure that the correct amount is paid to all Credit Providers on a monthly basis. This will continue until the debt has been repaid.
Contact us today and sleep tonight.