Debt Counselling in South Africa

Debt counselling in South Africa has been introduced in June 2007 to assist people who is over indebted to avoid legal action and bankruptcy. The National Credit Regulator regulates the South African credit industry.

It involves the help of a debt counsellor to avoid incurring debt you cannot repay. In most cases an application for debt review is done after the counsellor has assessed your financial situation.

In cases where you are living above your income, i.e. your expenses are more than your income, the counsellor will go through your financial affairs to establish the best possible solution to repay your credit providers. They often negotiate smaller payments over a longer period. The counsellor will take all your living costs into account when preparing a repayment plan.

Once the debt counselling and debt review process has started, your credit providers are not entitled to take legal action against you for 60 days.

Certain legal documentation (Form 16) needs to be completed and signed when you apply for debt review. The form and supporting documentation is handed over to the counsellor. The counsellor will notify all your credit providers that you’ve applied for debt review.

The credit providers have to provide information on your credit to the debt counsellor. The information you’ve provided is checked against the information from the service provider.

Although your details will be submitted to creditbureaus, when you are under debt review, it will be cleared as soon as you have paid all your outstanding debt. Debt counselling in South Africa protects you against unscrupulous debt collectors. It prevents you losing your assets. Ensure you make use of a debt counsellor who is registered and operate within the guidelines of the NCR.

When you failed to raise money through a personal loan or debt consolidation loans,debt review might be the answer you are looking for.