What is debt review?
Debt review, or debt counselling, is a debt relief measure that helps over-indebted South African consumers get out of debt. The process aims to help consumers who are struggling to make ends meet by reducing their monthly debt repayments. By doing so, you’ll have more money available for other monthly expenses throughout the month.
If you can’t afford your monthly debt obligations and cover other monthly expenses, you may be over-indebted. If this is your current financial situation, you may need professional assistance.
What are the benefits of debt review?
- Receive a monthly budget
- Only pay one single monthly debt repayment
- Your debt counsellor will renegotiate lower monthly repayments with your creditors.
- Receive legal protection against all your assets
How does debt review affect your spouse?
Debt review is a legal process where all income needs to be considered, and if you’re married, this may include your spouse depending on your marital contract. If you’re married outside the community of property your spouse won’t be affected at all. However, if you’re married in a community of property your spouse will directly be involved in the process.
How exactly does debt review affect your spouse?
Married outside community of property (OCOP)
If you’re married outside the community of property it means that the estate is not jointly owned. According to the law you and your spouse own everything independently.
Being married outside the community of property means that you can apply for debt review without involving your spouse. Your spouses’ financial situation will therefore not be affected.
Married in Community of Property (COP)
If you’re married in a community of property, you and your spouse will have a joint estate. Which means that everything you own is shared equally. This holds true even during the debt review process.
When you’re married in a community of property you and your spouse will both have to apply for debt review and proceed through the process together. Both parties will have to agree to enter the debt review process before the application can be processed.
Once you and your spouse enter the debt review process, both of you will be responsible for the repayments. Your combined monthly income will be taken into account when readjusting your new repayment amounts.
Talking to your spouse about your debt can be difficult, especially if you can’t afford your debt anymore. But don’t let that prevent you from taking action. The longer you wait the more your debt will become over time. If you are struggling financially, communicate with your spouse and work towards becoming debt-free together.
Being married in a community of property can be very beneficial. Your spouses’ income will be included when adjusting the new repayment amounts. That could greatly impact your ability to pay off your debt as soon as possible.
If you enter debt review your spouse will be affected depending on your marriage agreement.
If you are married in a community of property you and your spouse will have to enrol in the debt review process together. Both of you will have to agree to and sign any documentation. The combined household income will be taken into consideration when determining the new reduced monthly debt repayment amounts.
Being married in a community of property may be very beneficial as the income from both parties could make it easier to pay off any debt.
If you’re married outside the community of property your spouse will not be affected at all. Only your finances and personal information will be taken into consideration.
If you require more information please feel free to leave your contact information below, one of our friendly consultants will contact you as soon as possible.