To understand exactly how long does debt review lasts, you need to understand how the process works.
How does debt review work?
In 2007, debt review was introduced by the National Credit Act (NCA) to help over-indebted South African consumers. The process prevents consumers from being placed into personal administration and having to deal with the effects thereof. Because debt review requires debt counsellors to be registered with the National Credit Regulator (NCR) and follow very specific ethical guidelines when assisting clients, the process is highly effective. Find out more about debt review.
As everyone’s debt review plan is different, it takes a different amount of time to complete.
Factors that affect how long debt review lasts
- How much debt you have
- How much you can afford to repay monthly
Your debt counsellor will negotiate a repayment plan with your creditors that you can afford. The more you pay towards your debt every month, the faster you will become debt-free.
- Your commitment to becoming debt-free
The more committed you are to keeping up with your repayments and paying more towards your debt when you are able to, the sooner you will be able to exit debt review.
How to get out of debt fast
The more you pay towards your debt, the faster it will get paid off and you will be debt-free. If, while you’re under debt review, your financial situation improves, you can speed up the process by paying more towards your debt payments. Here are a few tips to help you speed up your debt payments:
- Pay off debts with higher interest rates first
By paying your higher-interest debt first, you will end up paying less interest in the long run. Read our blog on the debt avalanche method to find out how to tackle paying off debt effectively.
- Use any lump sums or bonuses to pay off debt
If you receive money from tax returns, policies, work bonuses, commission or any other lump sums, use the money towards your debt payments.
- Earn an extra income
There are various ways to earn some extra money every month, including working overtime at the office, selling products to earn commission, becoming an online freelancer and tutoring online.
- Lower your expenses
Consider moving into a smaller home to pay less rent, trading in your car for a cheaper model and not spending money on luxuries. Once you’ve paid off your debt, you can upgrade your lifestyle again (without getting into debt again).
How long debt review takes depends on you. The more committed you are to paying off your debt, the faster you will become debt-free. The purpose of debt review is to help you get out of debt for good. So, if you’re serious about changing your life and living in financial freedom, you will achieve it!