What is Debt Review?
Debt review is a legal process in South Africa designed to help individuals who are struggling to survive finacially. The debt counselling process involves a debt counsellor assessing the your financial situation. Then they work with your creditors to negotiate a repayment plan that is affordable and tailored to your specific needs.
Here’s how debt review works:
Step 1 – Free Assessment:
When you enter debt review, your debt counsellor will assess your financial situation. They will then determine how much you can afford to pay towards your debts each month. A debt counsellor will assess your financial situation, including your income, expenses, and debts.
Not sure if you qualify? Get your free debt assessment now
Step 2 – Application:
If the debt counsellor determines that you are over-indebted, and you decide to proceed with the process, they will apply to the National Credit Regulator (NCR) on your behalf to start the debt review process.
Step 3 – Creditor Protection:
Once you are under debt review, your creditors cannot take legal action against you without permission from the court. This protection lasts for the duration of the debt counselling process.
Step 4 – Creditor Negotiation:
The debt counsellor will negotiate with your creditors to reduce your monthly payments and interest rates, and to extend the repayment period if necessary.
Step 5 – Reduced Monthly Payments:
You will make one affordable monthly payment to a Payment Distribution Agency (PDA), which will distribute the funds to your creditors according to the negotiated repayment plan.
Final Step – Completion:
Once you have paid off all your debts under the repayment plan, the debt counsellor will issue a clearance certificate, and you will be debt-free.
Debt review is a powerful tool to help individuals reach financial freedom, but it’s important to understand that it’s not a quick fix. How long debt review last is dependent on various aspects, it requires a commitment to sticking to the repayment plan and managing your finances responsibly.
Tired of struggling with debt? Our expert counsellors will create a customised plan to help you get back on track. Contact us to speak to our expert counsellors and start your journey towards financial freedom.
