Written by: Karin Augustyn
Article source: JOY! Magazine
In this second instalment of a three-part series, Cape Debt Clinic will discuss how you are legally protected whilst under Debt Review. Click here to read the first.
Debt Review is a legal method for over-indebted South Africans to get out of debt. How do you ensure you are protected? It is important to deal directly with a registered debt counsellor. Ask for a copy of their NCR registration certificate. Debt counsellors are monitored by the National Credit Regulator and perform duties as stipulated in the National Credit Act of 2007.
What steps should one take?
The first step to legal protection is completing Form 16. From the moment you are registered, any legal action that was pending will cease. Collection calls will also cease. Your debt counsellor will negotiate new payment arrangements with your creditors. These are then made an Order of the Court. Please inform your debt counsellor if you continue receiving collections calls. It is important to notify your debt counsellor of any change in circumstance because your debt counsellor speaks for you during the debt review process. To retain your legal protection, you must maintain your minimum monthly payment. It is important that you are committed to settling your debt – you cannot exit debt review until all debt is settled.
What are the fees?
Payments are monitored by the NCR and are made via a Payment Distribution Agent (PDA).When you make your first debt review payment, the PDA will distribute payment to the debt counsellor to a maximum of R9000 (once-off). The assessment fee of R300 and registration fee of R50 are finalised in the second month. By the third month, fees are settled and your creditors will receive their first debt review payment. Your monthly debt review instalment includes a 5% recurring fee payable to the debt counsellor as well as PDA fees for each creditor.
Next month we will share testimonies of people who have become debt-free through debt review.
Karin Augustyn from Cape Debt Clinic is a registered debt counsellor with a passion for helping people with their finances. She is available for calls / WhatsApp messages on 073 903 6942, or email firstname.lastname@example.org. Visit www.cape-debt-clinic.co.za
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