Being in debt doesn’t have to be a bad thing. It can only become burdensome when you can’t afford to keep up with repayments.
When you are over-indebted, it will help to get help from a professional
During the debt counselling process a debt counsellor will look into your financial situation and then make recommendations to credit providers on your behalf.
The process of being assessed by a debt counsellor is known as the debt review process.
During the process, you are not allowed to access more credit. Only once you’ve been issued with the clearance certificate will you be able to access more credit.
It’s important to make sure that the debt counsellor is a member of the debt counsellor’s association. Debt counsellors must also be registered with the National Credit Regulator (NCR).
Accredited software systems must be used to determine your level of indebtedness.
How the Debt Counselling Process works:
You apply.Your finances are assessed to determine whether you are eligible for debt counselling or not. Keep in mind that you might not qualify. To qualify, you must be unable to pay your minimum monthly instalments.
If you are over-indebted, a debt counsellor will help you work out a budget that will help you repay your debt effectively. Or the debt counsellor will negotiate with your creditors, to rearrange your debt so you can pay a reduced monthly instalment over an extended period of time. The counsellor will contact all your credit providers and credit bureaus to confirm or verify your debts with them.
You’ll be informed of details regarding all costs involved at this point and a temporary repayment plan will be structured. There are some costs involved- debt counselling isn’t free.
You will be listed as being under debt review until you have repaid all your debts in full.
A Consent Order will be made by the local Magistrate’s Court. This is a voluntary agreement between two or more parties. If a credit provider rejects the plan, you will need to go to court.
The debt counsellor will then give you your final debt repayment plan.