Author: Ryan Cloete
Being over-indebted can be extremely stressful. This is when you find yourself not having enough money to meet your needs whilst trying to pay off existing debt.
However, ignoring debt could only lead to more trouble. It may be time for you to look into debt counseling where you will be provided with expert assistance and resources to help improve your financial wellbeing.
Annaline van der Poel, from Debt Rescue says the entire purpose of debt counseling is to help you pay the debt you already have. It also stops you from incurring more debt which would make your situation worse.
She explained that the process involves drawing up a budget where both your expenses and income is considered and determining how much debt you are able to pay.
The process also takes into account your living expenses like fuel, food, school fees and other expenses. It could also involve the debt counselor negotiating lower payment terms with your creditors over a longer period of time which could increase your disposable income.
Van der Poel adds that debt counseling is a temporary process and not a permanent blacklisting.
She said, “this is a temporary process that you go through to renegotiate with your credit providers to repay your debt at lower installments at a longer period of time making sure that you can continue to still cover your living expenses”.
Van der Poel adds that often, people who are already over indebted have to perform a juggling act where they have to decide whether to pay debt or cover living expenses. This could oftentimes result in people incurring more debt and making the situation worse.
“It’s a very very clear and structured plan on how you are repaying the debt that you’ve incurred so far and preventing legal action in the process and you know keeping you’re assets and so forth”, concluded Van der Poel.
Read the full article here: https://www.skillsportal.co.za/content/how-debt-rescue-process-works