Written by: Karin Augustyn
Article source: JOY! Magazine
In this first instalment of a three-part series, a registered Debt Counsellor will discuss Debt Review and where to get help when dealing with a debt crisis.
Nobody becomes over-indebted intentionally. Life can create a situation where a debt burden becomes too difficult to manage. When you cannot afford to pay creditors and living expenses and want to avoid legal action, who do you turn to?
Cape Debt Clinic is here to help you
Cape Debt Clinic was founded by Karin, a registered Debt Counsellor with a passion for helping people with their finances. In a debt crisis, a phone call to Karin is your first step. Karin will talk to you about your family commitments and together you will establish a reasonable living budget until your debt is fully settled. Next, we will obtain your credit report. If you are married, both partners will be involved in this process. If it has been a challenge to speak to your partner, our counselling session will help with mediation.
Implementing a plan to get out of debt
Once we have established a list of creditors, we will estimate acceptable repayments within the norms of the National Credit Act which governs debt review. Loans for assets like a home and vehicle are generally considered with a higher percentage repayment, and credit cards and personal loans with another calculation. Our repayment assessment must ensure that all debt is settled within a maximum of 5 years. Most of our clients have completed their debt review in less than 5 years. Finances may improve under debt review, which enables many clients to increase their payments, thereby shortening the process.
Debt review is not permanent!
When under Debt Review, you will be registered at the NCR and credit bureaus. You may not obtain credit whilst under debt review. This is not permanent! When all your debt is settled, we will provide you and the NCR with a clearance certificate. All credit bureaus will update and remove the Debt Review record.
…Next month, we will discuss how you are legally protected under Debt Review against further collections by creditors.
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