Are you struggling to pay your monthly debt repayments each month? Are you struggling to cover your basic living expenses? If yes, debt review may be for you!

Debt review is a debt relief measure in South Africa which was introduced in 2007 by the National Credit Act (NCA). The process was brought into place with the intention of preventing consumers from being blacklisted and having to deal with the consequences as well as to help over-indebted consumers get out of debt.

Debt review is suitable for South African consumers with an income who are currently struggling to get out of bad debt and cannot keep up with their monthly debt repayments. This process is highly advisable in comparison to an option such as consolidation loans because debt review is safer and more effective. Throughout the debt review process, your debt counsellor will need to follow strict and ethical guidelines set out by the National Credit Regulator (NCR).

How Does Debt Review Work?

A debt counsellor begins by assessing your outstanding debt and looks into implementing a restructured debt repayment plan. This is done through renegotiating interest rates with your credit providers in order to reduce them as well as to extend the debt repayment terms.

Following the renegotiations, your debt counsellor will then draw up a new affordable monthly budget and payment plan. You will only need to make one monthly debt repayment to a payment distribution agency (PDA), who will then pay all your credit providers. In turn, this relieves you of the stress of having to keep up to date with your monthly repayments.

The most important thing to know, when you are under debt review, you are protected by the NCA and creditors are no longer allowed to contact and hassle you.

What Happens When You Get into Debt Review?

The following happen when you are placed under debt review:

• You won’t be able to apply for credit for the duration of the debt review process
• You will be listed on the Credit Bureau
• You will be liable for paying debt counselling fees
• You will need to continue paying your instalments
• Your debt counsellor will assist you and walk you through the process

Benefits of Debt Review

Legal protection.

Prior to debt review, you may have experienced your creditors threatening to take legal action, once under debt review, this can no longer happen! As mentioned before, you are protected by the National Credit Act. Due to the regulations of this Act, your creditors shouldn’t communicate with you at all as your debt counsellor will handle all legal matters for you.

Communication with credit providers.

As mentioned above, your creditors should not communicate with you and you are not required to communicate with your creditors. From the moment you begin debt review, your debt counsellor will handle all communications on your behalf.

Negotiating with credit providers.

One of your debt counsellor’s duties will be to negotiate with your credit providers in order to extend your debt repayment terms. The point of this is to reduce your monthly repayment amount you need to pay each month. The importance of this step is to ensure that you can still afford your monthly living expenses.

Restructuring of debts.

Your chosen debt counsellor will help restructure your debts. As mentioned previously, you will then only need to pay monthly repayment to a payment distribution agency who then pays your creditors on your behalf. This is an effective way of being able to afford your debt repayments as well as still being able to cover your monthly expenses.

An affordable monthly budget.

When you take part in debt review, your debt counsellor will provide you with a new affordable monthly budget and repayment plan unique to your needs. Your debt counsellor will also provide you with guidance and advice on how to handle your finances to enable you to become debt free in the future.

Is Debt Review What You Need?

We at Exonerate encourage all South African consumers to manage their debt wisely as it can be a slippery slop once you start missing repayments. If you are past the point of being able to handle debt on your own, then we can possibly help you. Do any of these sound familiar:

– You’ve reached your overdraft/credit card limits
– You’ve fallen behind on your monthly repayments
– You’re selling assets to try make extra money
– You’re struggling to cope with the stress of money

If you can relate to any of these and are struggling to manage your debt, please don’t hesitate to reach out to us today. We will walk with you every step of the debt review process. At Exonerate, you will work with an actual registered debt counsellor who cares about you and your financial well-being.