The Debt Rescue Plan
The National Credit Act formally introduced Debt Counselling to assist over-indebted consumers like yourself by developing a repayment plan, which is affordable to you as well as acceptable to all your Credit Providers.
Complete our debt assessment!
- ID Document
- Proof of Income
- Proof of Residence
- List of living expenses
Complete our online debt assessment and provide us with the details of your financial situation.
We’ll assess and setup
Your Debt Counsellor determines whether your monthly expenses and debt exceed your monthly income.
You’ll be placed under Debt Review
We’ll inform all your Credit Providers and the Credit Bureaus that you are under Debt Review.
You only pay a single, reduced payment
We’ll restructure your payment plan and negotiate with your Credit Providers.
The process is finalised
Our specialist attorneys will apply at the court to make your restructured payment plan a court order.
While undergoing Debt Counselling, you will be protected against legal action taken by your Credit Providers and only have to pay one monthly, affordable reduced payment, leaving you with enough money for your monthly expenses
Request a free, personalised, no obligation debt assessment now!
How Does Debt Counselling Work
Many South Africans are over-indebted and are grappling with similar challenges in today's current economic climate. They are finding it increasingly difficult to manage their finances as they try to keep up with the rising costs of essential goods and services.
Why Debt Counselling?
Debt counselling, introduced by the National Credit Act (NCA) in 2007, is a process designed to help over indebted South Africans become debt free in an affordable manner.
Reduced Monthly Repayments
Debt counselling allows South Africans to renegotiate payment terms with creditors, resulting in lower monthly payments. This is achieved by extending the loan periods, making it easier for you to manage your monthly expenses.
Debt Consolidation
Managing multiple payments to various creditors can be complicated and stressful. Debt counselling simplifies this by consolidating your debt into a single fixed repayment plan. This provides a clear timeline for when the debt will be paid off.
This can help with financial planning and gives a clear end date to your debt, unlike revolving credit accounts that can remain indefinitely if only minimum payments are made.
Legal Protection
Debt counselling legally protects you from creditors taking action against you (like repossessing assets or garnishing wages). This legal protection kicks in as soon as the debt counselling process starts and lasts until all the debts are settled.
Structured Debt Repayment Plan
Your debt counsellor will create a structured repayment plan that consolidates all of the debtor's repayments into a single, more manageable monthly payment. This plan is designed to ensure that essential living expenses are covered first, with the remainder going towards paying off debt.
Avoids Long Term Credit Score Damage
By effectively managing debt through debt counselling, individuals can avoid being sequestrated or having their credit score severely damaged. While under debt counselling, a flag will be noted on your credit profile, it is generally seen as a positive step towards managing your debt responsibly.
Financial Guidance and Support
Debt counselling provides individuals with financial advice and support throughout the process. This includes teaching budgeting skills and how to handle finances more effectively to avoid falling back into debt in the future.
How Does Debt Counselling Work
Step 1: Reach Out for Help
If you're finding it hard to keep up with your bills and debt payments, the first step is to contact a registered debt counsellor. This is someone who's trained and officially recognized to help people manage their debt.
Step 2: Get a Free Assessment
You'll need to give your debt counsellor details about your income, what you spend your money on each month, and all the debts you owe. This helps them understand your situation.
Step 3: Let the Debt Counsellor Do Their Work
If you decide the process is for you, your debt counsellor will tell your creditors (the people you owe money to) and the credit bureaus (the companies that track credit scores) that you're under debt counselling. This means you're trying to fix your debt situation, and during this time, you can't get more credit (like loans or new credit cards).
Step 4: Work Out a Payment Plan
Your debt counsellor will work out a new payment plan with your creditors. This plan might mean you pay less each month but for a longer time. The plan is made to fit what you can afford after covering your basic living costs.
Step 5: Make One Monthly Payment
Instead of paying each creditor separately, you'll make one monthly payment to a payment agency. This agency then pays your creditors for you. This makes it easier to manage your money and ensures you don't miss any payments.
Step 6: Keep in Touch and Adjust if Needed
Your debt counsellor might check in with you to see how things are going. If your financial situation changes, they can adjust your payment plan.
Step 7: Finish Strong and Clear Your Name
Once you've paid off all the debt under the counselling plan (except for your house loan if it's not included), your debt counsellor will give you a clearance certificate. This is your golden ticket that says you've paid your debts. Your credit record will also be updated to show you're not under debt counselling anymore, and you can start afresh with managing your finances
Remember:
- You're Protected:
While you're under debt counselling, your creditors can't hassle you for payment or take legal action against you for the debts included in the plan. - There are Fees:
There are some costs involved in debt counselling, but they're regulated and reasonable. - It's a Fresh Start:
Successfully completing debt counselling can help you manage your money better in the future and avoid getting into the same situation again.
