Frequently Asked Questions:
1. What are the implications if I decide to go under Debt Counselling?
We will conduct an assessment of your state of indebtedness. If you are over-indebted (expenses exceed income), we accept your application for debt review. If you are not over-indebted, your application will be rejected. On acceptance, we will inform all credit bureaux, debt collectors and credit providers that you are under debt review. Credit providers are requested to verify your account information (outstanding balance, installment amount, interest rate, etc).
Credit providers and debt collectors will no longer be able to pursue legal action against you for the duration of the debt review process provided you maintain regular payments to credit providers in terms of the new proposals. Once we have completed the debt review and are eligible for debt counselling, we will draft repayment proposals for you. These proposals will be based upon your own individual circumstances and what you can afford to pay.
2. What happens to my accounts / credit cards?
All your accounts will be frozen by your creditors and debt collectors . This includes credit cards, overdraft facilities, revolving credit facilities and store accounts. You are required to continue paying your accounts (as much as you can) whilst under debt review.
3. Is this the same as being put under administration?
No. Administration only applies to people whose total debt does not exceed R50, 000 and normally lasts much longer and is much more costly. We aim to achieve a debt-free status within five to eight years.
4. Are there any accounts that do not get included?
Only credit agreements as defined in the National Credit Act may be included in the debt review process. Accounts such as doctor and cell phone accounts are excluded. Also excluded are accounts in respect of which legal action has been initiated (prior to your application for debt review) or where judgment and/or garnishee order(s) have been instituted.
5. What would happen if, say within one year from now, I find myself in a better financial position? Would I be able to get out of this?
No, the payment arrangements will stay in place until all the debts have been settled in full. However, you can amend your payment arrangements at any time in order to shorten the term of repayment (increase the payment, deposit bonuses, etc).
6. Will I have money left for day to day expenses? I don’t want to end up penniless.
We do take into account your living expenses prior to determining the amount available for credit providers.
7. Once the process has completed, will I still be listed at the credit bureau for a certain amount of time (blacklisted)? Will it have a – good or bad – effect on any future credit that I may apply for?
Your credit bureau profile will be flagged as ‘under debt review’. This will prevent you from obtaining further credit until all debts are settled. Only emergency loans are excluded. We will issue you with a clearance certificate once all your debts are settled; you will then be able to obtain credit again.
8. My husband and I both require your debt counselling services; I assume that you will need separate paperwork for him?
This is correct – both parties in the relationship will need to submit paperwork to determine family income and level of debt in the household.
9. Your company is based in Cape Town and I am in Gauteng – will that work?
Yes, you don’t need to see us personally. We have offices in most of the major urban centres.
10. At which point do I become bound by decisions that you make?
I do not want to leave my entire life in someone else’s hands, and am especially worried about my house. There are certain things I am not willing to do, so I would like to know that I have a say in what happens
We will ask you to approve our proposal before we send it to your creditors – the same goes for any further amendments. Let us speak to any debt collectors before the situation gets out of hand.