Debt Review Clearance Certificate

Get your Debt Review Clearance Certificate today. Simply complete the below free online application for assessment and one of our professionals will contact you.

What is a Debt Review Clearance Certificate?

A debt review clearance certificate is also known as Form19 is a certificate that verifies that a consumer has satisfied all obligations under every credit agreement that was subject to a debt review court order or debt review repayment agreement. This certificate is evidence that you are debt-free and you have completed the debt review process.

The issuing of a clearance certificate as per section 71 of The National Credit Act  (NCA 34 of 2005) signals the end of a successful debt review process. The effect is that even if the consumer has a long-term agreement that was subject to debt review such as a mortgage bond, they can obtain a clearance certificate after every other short-term credit agreement under debt review is paid in full.

In terms of the National Credit Act (NCA) 34 of 2005, the debt counsellor and not a court, must issue a clearance certificate.

This debt review clearance certificate can only be issued by a registered debt counsellor only if:

• All the restructured accounts as per the court order or agreement are paid up in full.
• There are no outstanding debt counselling fees.
• Home Loan or your bond under the above agreement may be excluded. In other words, a clearance certificate can be issued if there is an outstanding balance on your home loan account.

What can you do with your debt review clearance certificate?

There is not much you can do. The National Debt Review Center will act under Section 21 of the National Credit Amendment Act. This Act requires your debt counsellor to present all paid-up letters with your clearance certificate to all bureaus. The National Credit Regulator requires The National Debt Review Center to present all paid-up letters with your clearance certificate to all registered credit bureaus.

This is to assure that the rearranged accounts get amended by the credit bureaus as paid up. The National Credit Amendment Act also requires all registered credit bureaus to remove the negative months in arrears from your credit profile.

What happens after the Credit Bureaus have received your Debt Review Clearance Certificate?

Once the bureaus receive your Clearance Certificate, they will remove the debt counselling flag off your profile. In addition to this they will remove all your default listings and judgements. The only record that will remain is your payment history. According to the Credit Act, your payment history will remain on your record for two years.

How long until I can apply for credit again after getting my Debt Review Clearance Certificate?

Many people think they can get credit straight away after receiving their clearance certificate.

This is not always possible.

In theory, you should be able to apply for credit again within a week of receiving your Clearance Certificate. But we have seen that the credit bureaus take longer than that to clear your record. We would suggest waiting three months before applying for new credit.

After the credit bureaus receive your Clearance Certificate each account in your Payment History should have a “Paid-Up” or “Closed” status. Since your Payment History remains on your credit report for 2 years your credit score will take some time to become good – as time passes your credit score will improve, and by six months it will be in a much better standing (but you don’t have to wait that long to apply for credit).

Pull your credit report about one month after receiving your Clearance Certificate. Check that everything is in order before applying for credit. If you see that the Debt Review listing still reflects on your credit profile contact the credit bureau immediately to rectify the listing.

Also keep in mind that even though your credit score might be good, credit providers might still have a flag indicating your history on their internal systems. They must also remove those records. It always remains the decision of the credit provider whether or not they want to extend credit to you. If they do decline your credit application, you have a right to know exactly why they declined it.

Conclusion

A consumer under debt review can only be issued with a clearance certificate when:

• When they either have paid up all their debts which were listed in the debt review court order or debt review repayment agreement
• When all their short term credit agreements listed in the debt review court order or debt review repayment agreement which is short term agreements may include a vehicle financing agreement have been paid in full and the consumer is only left with a mortgage loan that is not in arrears in terms of the debt review court order or debt review repayment agreement.

Credit providers must issue paid-up letters on the short-term agreements prior to the issuing of a clearance certificate by the debt counsellor to ensure that the debt has been repaid in full.

Once the clearance certificate is issued this must be forwarded to all the credit bureaus together with the paid-up letters. The debt counsellor and credit bureaus have to update their systems to show that the consumer has successfully completed the debt review process.

Contact The National Debt Review Center experts today. We can help to issue a clearance certificate if all your accounts under debt review have been paid up so that you are able to enter into new credit agreements.