If you find yourself overwhelmed by debt you need to take action quickly….
The problem doesn’t solve itself and will get worse faster than you wish.

The action plan to get out of debt and back on your feet is much easier to deal with than waiting for the inevitable consequences of ignoring the problem.

Here are your options….

Go it alone
If you want to avoid debt counselling, contact your creditors personally and bring your situation to their attention. The lender would probably be better off arranging a compromise with the payment arrangements extending the debt over a longer period and reducing the repayments. In some instances arrangements can be made to service the interest only for a period. What ever you do do not apply for more credit!

Contact a debt counsellor                                                                                          They are regulated in compliance withe the National Credit Act and this is the process to follow:

Step 1
You complete an application form and providing details of all your Credit Providers.
(Consultations are usually done telephonically and by e-mail, but can also be done in person.)

Step 2
The debt counsellor will determine whether you are over-indebted by establishing if your monthly expenses exceed your monthly income.
(You have to be over-indebted to qualify for Debt Review.)

Step 3
If you are over-indebted, the debt counsellor will inform all your Credit Providers and the Credit Bureaus that you are under Debt Review. Your Credit Providers will also be requested to provide a Certificate of Balance (COB) in respect of your accounts.

(You will immediately start to pay a single provisional reduced monthly installment in respect of all your Credit Providers which will be affordable to you. During the first 60 working days, legal action may not be taken against you in respect of the debts that are under review.)

Step 4
After receiving all the COB’s, the debt counsellor will restructure your payment plan and negotiate with your Credit Providers where necessary. After negotiations with your Credit Providers, your new restructured payment plan will be sent to all your Credit Providers and this payment plan will take effect.

(Your restructured payment plan will reduce your monthly debt repayments to an affordable amount, leaving you with sufficient money for your living expenses.)

Step 5
The debt counsellor will instruct a specialist attorney to apply to the court to make your restructured payment plan a court order. You will not have to appear in court yourself, as your Debt Counsellor will be the applicant in the matter.

(The process will now be completed and you must ensure that your monthly payments are made timeously in order to prevent Credit Providers from taking action against you.)

The counsellor is entitled to 5% of the structured repayments to a maximum of R450.