Can Debt Review in South Africa help you out of debt?

Debt review is an incredible lifeline that can change the life of South Africans who are wallowing in the vicious circle of debt. For starters, debt review is a brilliant way to organize your debt and structure your repayment plans in a manageable and achievable way. 

Kicking off the process of debt review indicates that you’re taking action towards managing your finances and living a debt-free life. And just so you know, debt review isn’t a dent on your record; instead, it is an intelligent step towards financial freedom. 

To understand what debt review is along with its many benefits, today’s post will cover everything you need to know about debt review and why South Africans who are heavily indebted should take this route if they are really serious about getting out of their already mounting debt.

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What is debt review?

Debt review is a debt solution process designed for South Africans who are heavily indebted and struggling to manage their finances. Debt review is also known as debt counseling. Just so you know, debt review was introduced by the National Credit Act (NCA) to prevent consumers from being placed into personal administration while having to deal with the long-term effects of their debt. 

Debt counseling was also introduced to ensure that debt counselors adhere to strict and ethical guidelines when helping over-indebted South Africans gain their financial freedom. 

Through debt review, counselors work with their clients to assess their outstanding debt and develop a restructured debt repayment plan that works for everyone. Essentially, the debt review process entails renegotiating interest rates with creditors in a bid to not just reduce them but also extend the debt repayment terms. 

Simply put, debt review is a smart process that allows debtors to hand over their debts negotiations to a professional debt counselor. The debt counselor is the go-to person in charge of compiling all your debts, taking a look at your income, and working with you to work out a payment plan on your installments and interest options with creditors. 

Once all that is sorted out, the debt counselor negotiates with all your creditors on your behalf. The brilliant thing about the debt review process is that it makes your debt affordable while also protecting you from any type of legal action, asset repossession, and creditor harassment. 

What are the benefits of debt review?

Debt review comes with loads of exciting benefits you don’t want to miss. Read on as we have highlighted some of them. 

• With debt review, you get to pay only one reduced, affordable monthly installment for all your debt. How cool can that be? Let us also add that debt review makes it possible to enjoy reduced installments with all creditors and reduced interest.
• With debt review, you no longer have to deal with your creditors as the debt counselor will take over communications with your creditors, so you no longer have to deal with their constant harassment and threats.
• Your debt counselor will negotiate a structured and affordable repayment plan with your creditors and an exit day when you’ll get out of debt review. 
• Debt review makes it possible for over-indebted South Africans to have enough money to pay for their living expenses. 
• With the debt review process, the goal is to get you debt-free and eligible for credit again.

For heavily indebted South Africans excited about all of the fantastic benefits of debt review, you’ll be thrilled at just how easy it is to sign up for debt review. Read on as we will be diving into how debt review works shortly. 

How does debt review work?

Debt review may sound like a complicated process, especially if you’re learning about it for the first time, but guess what? We have broken everything down into steps for easy comprehension. Here are some of the steps we have put together to break down how the debt review process works. In order to start, click here: Debt Review, and fill in the form.

Step 1: A debt counselor will look at your current financial situation and work out your debt profile

Step 2: The debt counselor puts all the paperwork together and proceeds to execute a formal debt review.

Step 3: Reaching out to creditors and working out a repayment plan that works for everyone

Step 4: The debt counselor will then list you on the National Credit Bureau’s NCR Debt Help database.

Step 5: The NCR then proceeds to notify all credit bureaus that you signed up for debt review.

Step 6: The debt counselor then proceeds to negotiate with all creditors to confirm a repayment plan.

Step 7: Your creditors will then agree on the repayment plans, and a consent order will be issued to you. 

Step 8: You can start paying off your debt with peace of mind. 

How much does debt review really cost?

The National Credit Regulator has set the debt review fees. What this means is that you’ll not be charged more or less. Plus, most debt review firms you do business with adhere strictly to the NCR Fee Guideline. Keep in mind that the fee is part of the debt review process and is paid by the PDA directly to your preferred debt review agency. Once the fee is paid, the PDA immediately starts paying your creditors. And because the process is transparent, you’ll see the fee reflected in the debt restructuring payment plan issued to your creditors. 

Can I exit debt review?

Anyone can exit debt review prior to the form 17.2 notice being issued. You can simply provide written instruction to the debt counselor to that effect. On the flip side, once the 17.2 notice has been issued, the exiting procedures change. Considering that your debt counselor has confirmed that you’re over-indebted to your credit providers, you’ll have to launch a formal court application to prove that you’re, in fact, not over-indebted. Only when you win such an application will a debt counselor remove the debt review listing from your credit process. 

If you fail to follow this process, the debt review status will remain on your credit profile until you’re able to pay off all your debts. 

When will I be certified debt-free?

Once you’re able to pay off all your debt, except for your bond, you should get a Clearance Certificate from your debt counselor confirming that you have indeed settled all your debt and you’re now debt-free. Once you’ve cleared all debts and you’re issued a clearance certificate, you are now eligible to apply for new credit. 

Keep in mind that once you have settled all your debt, there is no rehabilitation period applicable to you as you’re now free to take on new credit if you wish. 

What are the drawbacks of debt review?

• Once you apply for debt review, you can only get out of the debt review process by paying up your debt or bringing an application to the court to prove that you’re no longer over-indebted
• During the process of debt review, you’re not allowed to access further credit. What this means is that you cannot use your credit cards, store cards, or apply for a loan. You can only apply for new loans when you have exited the debt review process. 
• Debt review requires commitment from your end as you cannot miss any payment. If you ever default on your payment, your creditors will pursue every legal action to recoup their money. 
• Always keep an eye out for incompetent debt counselors. Before applying for debt review, ensure you do business with a reliable debt counselor, especially one with a good reputation and industry experience. 

Note: Even though debt review is designed to help you get out of your mounting debt and ensure that all your creditors get paid what they are owed, the process allows your creditors to meet you halfway as they are open to accepting extended payment terms at reduced repayments and lower interest rates. 

Debt review is a smart process aimed at getting over-indebted South Africans out of debt while allowing them to take charge of their finances. 

What happens if I can’t pay my full debt review?

If you’re unable to meet up with your own part of the debt repayment plan and fall short on your payment or not pay them at all, then your creditors have no choice but to take legal actions to recoup their money. And just to be honest with you, you must avoid such a scenario at all costs. 

Keep in mind that the debt review process is a lifeline. Through debt review, you get an opportunity to negotiate your debt and agree on an affordable amount every month. And just so you know, the debt review process shields you from any type of legal actions and repossessions. 

Unfortunately, if you fail to meet your debt review obligations, your creditors will take legal actions, which can result in forfeiting your assets, including your home. To this end, you must do everything possible to honor the debt repayment plan negotiated during the process of debt review. This will save you and your family unwanted stress and hardship. 

Get your debt review process started

Want to get the debt review process started but don’t know where to start? Well, you’re in luck today. Simply fill out the form on Debt Union, and we will take it from there. With our team of debt review professionals, you’ll get out of debt sooner than you expect.