Is debt review the last and only option available to you? Have you tried everything else and failed? If so, then just like thousands of South Africans who desperately need to get out of debt, you need to get familiar with the process.
What is Debt Review?
This is also referred to as debt counselling, and is the advice that a person in debt receives from a registered debt counsellor. In the event that you have accumulated excessive debt and financial obligations, and your income is unable to sustain the payments, the National Credit Act outlines the steps to be taken.
This Act, passed in 2007, also regulates how credit is given and who qualifies to grant and receive credit. If you feel like you are nearing the end of the road and you have lost everything, then rest assured that you can get the counselling necessary to teach you how to use credit and deal with your debt.
How It Works
If you are deep in debt, you should contact a registered debt counsellor. You can meet them in person so that you can both go through your financials. If you are unable to meet physically, you can still correspond over the phone, Skype or via email.
The debt counsellor will have you fill in what is known as a Form 16, which essentially summarises your entire debt situation. The information you provide on the form is what your debt counsellor will use as a snap shot of your situation, as well as determining potential remedies to resolve your crisis. It is important to provide as many details as possible, so be ready to present your financial statements.
You will be assisted to develop a new budget. You may be forced to cut out some household expenses, but if you are truly committed to easing the financial pressure and clearing your debt, you will have to follow the monthly budget closely.
Some debt counsellors offer free debt review consultations and advice, though they are allowed to charge up to R50 for this. It is important to be aware that there are unregistered debt counsellors out there. All debt counsellors have to be registered with the National Credit Regulator.
Dealing with Creditors
Your debt counsellor will inform all your creditors of the new arrangements. If your creditors agree to the proposals, they will respond and make the necessary changes. If they don’t, then they may offer counter proposals, which the counsellor will discuss with you. Sometimes the process has to be taken to court to get a resolution.
If you are looking to get a debt review, contact One Debt. Take action to get yourself back on your feet.