Many South Africans are struggling to afford all their monthly bills at the moment. As a result of this consumers rely on debt relief programmes to help cope with their financial situation. One solution may be Debt Administration. What is debt administration and how does it work?
There are various financial relief options to choose from if you are in a tight financial situation.
Debt review is a legal process that helps over-indebted consumers get out of debt. Debt Rescue has helped more than 30,000 over-indebted South Africans become debt-free. Find out more about this process and how it can help your finical situation, by clicking here.
However, although debt review is a reliable and effective debt relief option, it may not suit your financial situation.
A relief option like debt administration may be more suited for your situation.
But what is debt administration and how does it work?
What is debt administration?
A Debt Administrator will take over all your financial obligations and make necessary payments on your behalf.
The Debt Administrator will deduct your living expenses from your income and divide the remaining amount equally among creditors.
You may only be placed under debt administration by court order, which makes this a legal process. The court will grant the Debt Administrator to take full control over your finances and prevent creditors from taking any further action against you.
Your total debt amount may not exceed R50 000 when applying to this process. If you do have more than R50,000 in debt, consider a debt relief option such as debt review which may be more suitable to your financial situation.
Advantages of debt administration
- The Debt Administrator must provide a Distribution Account every 3 months to show evidence of where your money has been spent.
- This statement must show how much money was received, deducted and how much each creditor received.
- The debt administrator must provide you with these financial statements. You can use these statements to ensure that all your financial obligations have been met.
Is debt administration my best option?
In short, administration is best suited for consumers who have 1 or 2 small debt accounts below 50,000 but are struggling to pay their monthly debt obligations every month.
Both debt administration and debt review are good options if you need financial assistance.
Get in touch with us today and find out which option would best suite your financial situation.
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