DEBT COUNSELLING FREQUENT QUESTIONS AND ANSWERS

 

Q - How will the Debt Counselling process influense my credit record?

A - In terms of the National Credit Act a consumer under Debt Counselling is not allowed to enter into a new credit agreement in the period the consumer is under the Debt Counselling Process. For this reason must the Debt Counsellor annotate the credit record that the consumer is under Debt Counselling.

However the annotation will be removed within 5 business days once the consumer has repaid the debts forming part of the Debt Counselling process.

 

Q - How long will I be under Debt Counselling?

A - The repayment term is normally calculated over a 60 months period to repay personal loans, credit cards and retail accounts. The repayment term will be longer if the consumer has a vehicle / home loan account.

 

Q - What is the fees applicable to the Debt Counselling process?

A - The Debt Counsellor and Legal fees are dependant on the payment profile of the individual consumer. Please refer to the DC Process page for more information on the fees applicable.

 

Q - Will I lose any of my assets whilst under Debt Counselling?

A - No - As long as the payments are made monthly in terms of the accepted repayment proposal the Credit  Provider  has no right to take any legal action to enable them to attach any of the consumer's assets.

However if payments are not made the Credit Provider has the right to terminate the Debt Counselling process and continue with normal legal action which can then lead to the attachment of the Consumer's assets.

 

Q - Can I leave the Debt Counselling process before I have settled the debts forming part of the Debt Counselling process?

A - The National Credit Act prescribe the following;

• Once the consumer has repaid all the debts the Debt Counsellor will issue a clearance certificate and remove the process from the consumer's credit record OR

• Once the consumer has repaid all the short term debts, with only an amount still outstyandinmg on the home loan, the Debt Counsellor will issue a clearance certificate and remove the process from the consumer's credit record OR

• The consumer may apply to court to have the debt counselling process removed but the consumer will have to prove to court that he / she ios no longer over-indebted.

 

Q - Can I choose which credit agreements to include / exclude?

A - No, all credit agreements must be included​.

 

Q - Can I include Service Agreements i.e. cell phone, doctor accounts?

A - No a service agreement is not a credit agreement and can thus not be included in the formal process.

However as the amount owned under the Service Agreement must still be settled we will negotiate with the Service Provider for a monthly repayment and the payment will formed part of the repayment plan.

 

Q - Do I continue to make payments, in terms of the new payment plan, to the Credit Providers?

A - No. It is a requirement of the National Credit Regulator that the consumer's payments are administrated through a NCR registered Payment Distribution Agent. We will down load the payment plan to their system who will then debit the consumer's account via a debit order instruction on a specified date and will distribute the amount to the different Credit Providers, once the funds are cleared. A distribution statement will be produced monthly and mailed to the consumer to monitor payments distributed on the statement received from the Credit Provider.

 

Q - Can I make additional payments in the period under Debt Counselling?

A - Yes you may make additional payments from time to time. If the financial position of the consumer improve the consumer can instruct the debt counsellor to increase the monthly payment which will repay the debts over a shorter period of time.