Short answer:
Debt review offers legal protection to over-indebted individuals under the National Credit Act. Once you enter the debt review process, your creditors must stop all collection efforts, including phone calls, letters, and legal action, allowing you to manage your debts without harassment.
Immediate Protection From Creditors
Once your debt review begins, creditors are legally required to cease all direct contact. Your accounts are flagged as “under debt review”, preventing any collection calls, letters, or legal threats. This protection remains in place for the entire duration of the debt review process, typically 3–5 years, depending on your repayment plan.
For more on repayments, see How do payments work under debt review.
Note: While payments are made through a Payment Distribution Agency (PDA), the details of how payments work are covered in How do payments work under debt review?
Court Approval for Legal Action
Creditors cannot take legal action against you during debt review without court permission.
The court only grants permission if:
- You are not adhering to the agreed repayment plan, or
- There is a legitimate reason for the creditor to take legal action.
This ensures that you are protected from unfair lawsuits or asset repossession while your debt counsellor negotiates manageable repayments on your behalf.
Why This Protection Matters
Debt review gives you the time and legal space to get your finances back on track. By halting creditor harassment, it helps you:
- Reduce stress and financial pressure
- Avoid unnecessary legal conflicts
- Repay debts in a structured and manageable way
For additional benefits, see What are the advantages of debt review?
