Top 55 Frequently Asked Questions about Debt Review Removal in South Africa – Answered

Published by The National Debt Review Center on

Struggling to exit Debt Review in South Africa? This comprehensive guide answers the top 55 frequently asked questions about Debt Review Removal in South Africa. Find out how to clear your record, manage outstanding debts, and regain financial freedom.

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Debt Review Removal in South Africa is governed by the following sections of the National Credit Act;

  • Section 86(7)(a) on the National Credit Act (NCA) deals with debt review rejections.
  • Section 71 of the National Credit Act (NCA) deals with debt review clearance certificates
  • Section 87 of the National Credit Act (NCA) deals with the removal of debt review after you have been declared overindebted by a debt counsellor.
  • Section 165 of the National Credit Act (NCA) read together with Section 28 of the National Credit Amendment Act of 2019 deals with the removal of debt review if there is a debt review court order in place.
By Sibabalwe DakanaThe National Debt Review Center

Frequently Asked Questions about Debt Review Removal in South Africa – Answered

1. What is Debt Review Removal?

Debt review removal refers to the legal process of officially removing the debt review listing from your credit profile in order to restore your credit worthiness.

When someone is under debt review, it means they have sought assistance from a registered debt counsellor to restructure their debts because they were unable to meet their financial obligations and thus over-indebted. This status is noted on their credit profile. Read Here About Debt Counselling and the Debt Counselling Process

However, once a person has successfully paid off their restructured debts or their financial situation has improved to the extent that they can handle their debts without the aid of debt review, they may wish to have the debt review listing removed from their credit record. This process is known as debt review removal.

Debt review removal is important because having a debt review status on your credit profile can impact your ability to access new credit more especially if you were wrongfully listed under debt review.

(Lenders are not allowed to grant credit to a consumer listed under debt review in terms of The National Credit Act.)

In a nutshell, by removing the debt review status, an individual can restore their creditworthiness in the eyes of potential lenders and regain access to the credit market.

2. How do you Apply for Debt Review Removal in South Africa?

The best route to take when you want to exit debt review is to contact a registered debt counsellor. You will then be required to complete an application for assessment similar to the below free assessment form below. This application for debt review removal form will help us assess your financial situation and eligibility for debt review removal.

3. How much does it cost to be removed from Debt Review?

The cost of debt review removal through The National Debt Review Center is set at R8550.00 vat exclusive, with an option to pay this amount over 2 or 3 months.

It’s important to note that debt review removal fees can vary, as they are not regulated in the same way as the debt review fee structure. Some law firms and debt counsellors may charge fees ranging from R3500.00 to R12,000.00 for this service.

4. How long does it take to be Removed from Debt Review in South Africa?

The process of being removed from debt review typically takes between 3 to 6 months, although this duration can extend if there are complications and delays. The process includes preparing and submitting a court application, which can realistically be completed in less than 1-2 months.

The primary cause of delays in the debt review removal process often stems from the courts, as we depend on the allocation of a court date, over which we have no direct control. Despite our legal team’s efforts to secure the earliest possible date, the scheduling is ultimately determined by the court.

Additionally, Magistrates may sometimes require extra documents that were not initially foreseen, leading to possible postponements and further delays. However, it’s important to note that such postponements generally occur only once if needed.

After the court order is obtained, the NCR will require to verify the court documents which usually take 7-14 business days and the credit bureaus will need a minimum of 21 business days to update the consumer’s credit report to reflect that they are no longer under debt review, as per the National Credit Act 34 of 2005.

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5. What documents are you going to need to assess my debt review removal application?

ID Copy
Payslip or proof of income
3 Months Bank Statement
Marriage Certificate if Married in-Community of Property or ANC contract if married out of community of property
Proof of Address
Complete NDRC Application Form
Previous Debt Counsellor Documents (This will include but not limited to, application form & application documents, proposal, 17.w if applicable, 17.7, legal pack & court order if applicable).
NDRC POA and other important documents.
Court order (if applicable)

6. Can debt review be removed?

Yes, debt review can be removed under certain conditions. The process of debt review removal involves several steps, and it is typically done if your financial situation has improved significantly or the the debt review order was granted in error or a mistake or due to failure to comply.

7. How can I remove my debt review status for free?

You can remove your debt review status by yourself without paying anyone, but you’ll need to handle your own court case and get all the necessary papers. This means you’ll have to understand the court process and make sure you collect all the right documents from the right people.

8. How many years does it take to removed from debt review?

The debt review removal process does not take years to complete. The process usually take 3-6 Months if you contact The National Debt Review Center.

9. Is it easy to get out of debt review?

Exiting debt review is not a straightforward process, it involves a complex and demanding legal procedure that requires a comprehensive set of documents, which are often not easy to obtain.

Additionally, a thorough understanding of South African consumer laws and court procedures is essential. This means that successfully navigating out of debt review demands considerable effort and expertise in legal and financial matters.

10. Can I remove my name under debt review if have not finished paying my debt?

Yes, it is possible to remove your name from under debt review even if you have not finished paying your debt. However, this process requires specific conditions to be met and it’s important to approach it with professional guidance from The National Debt Review Center.

The removal process involves legal considerations and an understanding of South African consumer legislation and court procedures. The National Debt Review Center can help you with these complexities and gather the necessary documentation. It’s crucial to ensure that your case is handled correctly to avoid any potential legal or financial complications.

11. Even after I have cleared all my debts under debt review, my credit report still shows that I am under debt review. How can I get the debt review status removed from my credit report?

If you have fully paid off all the debts included in your debt review but the debt review status still appears on your credit report, you should first obtain a clearance certificate from your debt counsellor. This certificate is evidence that you have settled your debts. (in some cases it confirms that you are only left with your home loan and considered no longer over indebted).

Once you have this certificate, your debt counsellor should forward it to the credit bureaus. If your credit report does not reflect the update after a reasonable period, you can directly contact the credit bureaus, provide them with the clearance certificate, and request an update of your credit status or request your debt counsellor to resend the certificate.

Be aware that updating your credit report can take 21 business days, as credit bureaus follow their own procedures and schedules for such updates. If you face any challenges or delays in this process, consider contacting your debt counsellor prior seeking advice from another legal professional or debt counsellor.

12. Can I remove debt review myself?

Removing debt review typically requires professional assistance, especially if it involves legal proceedings or negotiations with creditors.

If there are issues with your debt counsellor or if they’re no longer practicing, you may need to seek assistance from the NCR or another registered debt counsellor.

13. Can I apply for debt review removal if my debt review order was a consent order that was confirmed by the National Consumer Tribunal?

Yes – The Tribunal order is similar to the Magistrates Court Order. You can apply for debt review removal if your debt review application was made an order of the court.

Please ensure you contact your debt counsellor before you apply for debt review removal and find out if the court order was indeed granted. We also advise that you request your debt counsellor to provide you with the following documents.

Initial Application Form (Form 16).
Payslip used when applying.
Withdrawal letter (17.W).
Full issued application & the granted court order.

14. How can I get a Clearance Certificate if I cannot locate my debt counsellor or the debt counsellor got deregistered?

The first step is to check the registration status of the debt counsellor HERE or contact the National Credit Regulator on 0860627627

You can also contact any registered credit bureau and request a free copy of your credit report. Locate the debt review listing and you will be able to see your debt counsellor and their contact details.

If you have exhausted all of the above options and still get no luck, you can contact us and we will issue your clearance certificate.

The process is similar to the debt review application because we will be taking over from the previous debt counsellor.

Find more information about the debt review clearance certificate and application forms HERE.

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15. Do I need to be present in court for my debt review removal application?

Yes, if you will be self-representing but if you are represented by your debt counsellor or the debt counsellor is the applicant then the consumer does not necessarily have to be present in court.

The consumer must facilitate the process where required, typically by providing required information and documentation.

16. Can I cancel my Debt Review and continue to pay directly the reduced installment to my creditors.

The application to terminate a debt review depends on the consumer’s ability to show he or she is no longer over-indebted.

If the consumer cannot afford to increase the debt review repayment amounts, preferably to the amounts that they were paying before commencing with the debt review process, it is highly unlikely that the application shall succeed unless the creditors have indicated acceptance of such reduced payments.

17. Once Debt Review is terminated, creditors cannot take legal action to recover debts.

Section 88 (3) of the National Credit Act (NCA), provides that a creditor may not take legal action to enforce a credit agreement if the consumer has already applied for debt review and the application has been accepted and the consumer has been declared over-indebted.

This provision only applies while the consumer is under debt review.

As soon as the consumer’s debt review is terminated, creditors have the right to take legal action to enforce a credit agreement that was previously subject to debt review, typically calling upon the consumer to settle any arrears that may have accumulated on the account and reverting to the original initial contractual repayment amount.

18. Can I remove debt review myself?

Removing debt review typically requires professional assistance, especially if it involves legal proceedings or negotiations with creditors. If there are issues with your debt counsellor or if they’re no longer practicing, you may need to seek assistance from the NCR or another registered debt counsellor.

19. When can a credit provider terminate debt review?

A credit provider can terminate the debt review process if you fail to meet the agreed-upon terms, such as missing payments. They have the right to issue a Section 86(10) notice, withdrawing from the debt review and proceeding with legal action to recover the debt.

20. Is debt review a criminal record?

No, being under debt review is not a criminal record. It is a legal process aimed at helping individuals manage their debts more effectively. However, it does affect your credit record and your ability to access further credit while under review.

21. What happens when you cannot pay your debt review?

If you cannot pay according to the restructured plan under debt review, your credit providers might terminate the debt review and take legal action to recover their money. This can lead to judgments against you and further impact your credit score.

22. Is it true that after 7 years your credit is clear?

In South Africa, negative information on your credit report generally stays for a period of up to 5 years. This includes information like missed payments or judgments. After this period, the information should be removed, improving your credit score. However, this does not mean your debts are written off or cleared after 7 years.

You will need to review your credit report and confirm.

23. Can I get a loan after being removed from debt review?

Yes, once you have been removed from debt review you can apply for credit again. However, the decision to grant a loan will depend on your credit score and financial situation at the time of application.

24. How much does it cost to remove debt review in South Africa?

The cost of removing debt review varies and can depend on several factors, including the complexity of your case and the fees charged by your debt counsellor or legal advisor. The National Debt Review Center have a set fee of R8550.00 to for their removal applications. This fee can be arranged and paid over 2-3 months.

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25. Can I buy a car immediately after debt review?

After completing debt review, you can apply for credit, including car finance. However, whether you can buy a car immediately depends on your current credit score and financial status. Lenders will assess your creditworthiness post-debt review before approving any loan.

26. Which bank can help with my debt review or debt review removal?

Most major banks in South Africa work with the debt review process. This includes banks like ABSA, Standard Bank, Nedbank, and First National Bank (FNB). They have departments dedicated to handling debt review cases and can work with your debt counsellor. The National Debt Review Center work with all registered credit providers.

27. How long does the debt review flag stay on your name?

The debt review flag remains on your credit profile until you have completed the debt review process or have obtained an order declaring you no longer overindebted. Once this certificate or order is issued, credit bureaus are required to remove the debt review flag from your credit profile, typically within 21 days.

28. What are the disadvantages of debt review?

Disadvantages include restricted access to further credit during the review period, potential long-term impact on your credit score, and the possibility of paying more over time due to extended payment terms. It also involves fees for the debt counsellor’s services.

29. What are the disadvantages of debt review removal?

Removing yourself from Debt Review requires a clear plan and the commitment to handle your finances responsibly. You become solely responsible for managing your remaining debt. Sticking to a strict repayment plan is crucial to avoid falling behind again.

Exiting Debt Review removes the legal shield it provides. Creditors will regain the ability to pursue legal action for outstanding debts, including:

  • Court summons
  • Wage garnishment
  • Asset repossession

This significantly increases the pressure to manage your repayments diligently to avoid such consequences.

30. Can I apply for a house while I am under debt review?

No.

While under debt review, you are generally not allowed to incur any additional debt, which includes applying for a home loan. Your focus during debt review is to settle your existing debts as per the restructured plan.

31. How do I remove debt review status in South Africa?

To remove the debt review status, you need to contact The National Debt Review Center on 0410125036. They are considered as the best debt review removal company in South Africa.

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32. What is the red flag on debt review?

The “red flag” on debt review refers to the indicator on your credit report that shows you are under debt review. This flag alerts creditors that you are undergoing a debt restructuring process and cannot access more credit during this period.

33. How do I check my debt review status?

To check your debt review status, you can request a copy of your credit report from a credit bureau, which will indicate if you are under debt review. You can also contact your debt counsellor or the National Credit Regulator (NCR) for this information.

34. Can I Cancel Debt Review?

Yes, it is possible to cancel debt review. However, it is important to note that debt review is a legal process that provides debt relief to consumers who are over-indebted. Cancelling debt review prematurely may result in legal and financial consequences, such as the resumption of legal action by creditors and the loss of the benefits provided by debt review. Therefore, before making the decision to cancel debt review, it is advisable to consult with a qualified debt counsellor or attorney who can guide you through the process and explain the potential implications.

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35. What are the Implications of Cancelling Debt Review?

  1. Cancelling debt review means losing the legal protection against creditors, who may then proceed with legal action for debt recovery.
  2. Exiting debt review before clearing your debts can negatively impact your credit score, making it harder to obtain credit in the future.
  3. Without the structured repayment plan, you may find it challenging to keep up with debt payments, leading to potential financial strain.

Before cancelling, it’s advisable to speak with a debt counselling expert. They can provide clarity on:

  • The legal process of exiting debt review.
  • How cancellation might affect your current financial situation and future creditworthiness.
  • Alternative strategies to manage your debts without exiting the debt review prematurely.

Cancelling debt review is a significant decision with long-term financial implications. Thoroughly weigh the pros and cons and consider seeking professional advice to ensure you’re making an informed decision that aligns with your financial goals and capabilities.

Frequently Asked Questions About Debt Review Removal In South Africa

36. What are the Benefits of Staying Under Debt Review?

  1. While under debt review, creditors cannot take legal action against you for debt recovery, which provides significant financial relief.
  2. Debt review offers a manageable repayment plan that fits within your budget, allowing you to repay your debts in a more organized and less stressful manner.
  3. Often, debt review results in reduced monthly payments, making it easier for you to manage your finances.
  4. Debt Counselling encourages financial discipline and better budgeting skills, as you are required to stick to the agreed-upon repayment plan.

37. Which is the best debt review removal company in South Africa?

The National Debt Review Center is considered the best debt review removal company in South Africa. They were among the first debt counselling companies to handle this process, which was traditionally managed solely by attorneys who then later sent the documents to debt counsellors or the NCR to request updates.

The National Debt Review Center (NDRC) has played a significant role in shaping the landscape of debt review removal services in South Africa. They were among the first debt counselling companies to enter this field, traditionally reserved solely for attorneys.

NDRC’s approach to debt review removal differs from some solely attorney-driven processes. They advocate for debt counsellors being involved in the initial stages to ensure a comprehensive and proper understanding of the individual’s financial situation. While an attorney’s expertise is crucial for court appearances to obtain the debt review removal order, NDRC emphasizes the involvement of a debt counsellor throughout the process.

Following the successful court order, the attorney returns the case to the debt counsellor. This ensures a smooth transition and empowers the debt counsellor to handle the crucial task of updating credit bureaus, the National Credit Regulator (NCR), and creditors, reflecting the successful removal of debt review. This comprehensive approach stands in contrast to some attorneys who might not involve debt counsellors throughout the entire process.

38. Who qualifies for debt review removal?

Individuals in South Africa who meet the eligibility criteria outlined in the National Credit Act (NCA) and the National Credit Amendment Act (NCA Amendment Act) qualify for debt review removal.

  • Section 86(7)(a) on the National Credit Act (NCA) deals with debt review rejections.
  • Section 71 of the National Credit Act (NCA) deals with debt review clearance certificates
  • Section 87 of the National Credit Act (NCA) deals with the removal of debt review after you have been declared overindebted by a debt counsellor.
  • Section 165 of the National Credit Act (NCA) read together with Section 28 of the National Credit Amendment Act of 2019 deals with the removal of debt review if there is a debt review court order in place.

39. How do I know if my debt review flag has been removed?

  • The NCR debt help system status code will be updated to B or G or G1 or F2 or F1
  • The debt review listing will be removed from your credit profiles.
  • Your creditors will send you confirmation that the listing is also removed from their systems.
  • Your debt counsellor will send you confirmation.

40. What are the definitions of the NCR DHS Status Codes?

  • Status Code : A – Applied for debt counselling and being assessed
  • Status Code : A1 – Voluntary withdrawal by consumer prior to being declared over-indebted
  • Status Code : B – Assessment has resulted in a rejection
  • Status Code : C – Assessment has resulted in a decision that the consumer is over-indebted
  • Status Code : D3 – Formal debt re-structuring through the courts has commenced
  • Status Code : D4 – Formal debt re-structuring is completed, and a court order granted
  • Status Code : F – DC declares that the consumer is no longer over – indebted
  • Status Code : F1 – All restructure have been settled except mortgage agreement
  • Status Code : F2 – All restructure debts have been settled
  • Status Code : G – Magistrate rescinded the debt review court order/consumer opposed debt review application and has been declared not over-indebted. (Option C on Form 17.W)
  • Status Code : G1 – Application for debt review rejected by Magistrate – not over indebted. (Option D on Form 17.W)
  • Status Code : I – Consumer deceased

41. Can I apply for debt review removal online?

Yes.

42. Will there be something showing that I was under debt review after I have successfully exited debt review?

Generally, no. Once you’ve successfully completed the debt review removal program your credit report shouldn’t explicitly mention your past involvement in debt review.

43. Does debt review removal affect the eligibility for future business loans?

Debt review removal itself will not directly hinder your eligibility for business loans. Once you have successfully completed the debt review removal program your credit report shouldn’t explicitly mention your past involvement in debt review.

44. Are there any tax implications associated with debt review removal?

No.

However, tax implications can vary depending on the specific situation. Consulting a qualified tax advisor is essential for accurate information.

45. Can I renegotiate the terms of remaining debt (e.g., interest rates) with creditors after exiting debt review?

Exiting debt review doesn’t prevent you from negotiating with creditors directly. However, please be advised that you will be obligated to revert back to the original terms. This therefore means you will no longer enjoy the benefits of reduced installments and interest rates.

46. If I qualify for partial removal due to a remaining home loan, can I re-enter debt review if I encounter further financial difficulties?

This scenario requires consultation with a debt counsellor. They will assess your financial situation and determine if re-entering debt review is a viable option.

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47. How is debt review removal handled if the individual under debt review passes away?

Upon receiving all necessary documents, the debt counsellor will update Status Code : I – Consumer deceased.

Notify all relevant parties, check and attend to all credit & life insurance document submissions and the deceased estates administration process will commence.

Remember: Consulting a legal professional specializing in estate administration is crucial.

48. Can creditors take legal action to recover outstanding debts while the debt review removal process is ongoing?

Creditors might still pursue legal action if they have legitimate reasons, such as terminations or breaching a court order issued during debt review. 

49. Does a history of debt review or the removal process impact the ability to travel internationally?

Debt review history or removal shouldn’t directly restrict your ability to travel internationally.

50. Following debt review removal and consistent responsible financial management, how long does it typically take to see a significant improvement in credit score?

Several factors influence credit score improvement, including:

  • Repayment behavior: Consistent on-time payments significantly improve your score.
  • Credit utilization ratio: Keeping your credit card balances low is crucial.
  • Length of credit history: A longer history of responsible credit management benefits your score.

You will therefore see a significant improvement immediately once the bureaus confirm that the listing is removed. This is usually 21 business days after the NCR has confirmed the validity of the documents.

The score will continue to increase when you adhere to the abovementioned factors that influence the credit score improvement.

51. Are there alternative solutions for individuals seeking to exit a debt review program if they don’t meet the full criteria for debt review removal.

Yes.

  • Sequestration: This is a formal insolvency process overseen by the Master of the High Court. It involves surrendering your estate’s assets to a trustee who then distributes them proportionally to creditors. Important Note: Sequestration has significant consequences, including potential limitations on future credit applications and business ventures. Consulting a qualified legal professional specializing in insolvency law is crucial before considering this option.
  • Administration Order: This is a less severe alternative compared to sequestration. An administrator appointed by the court manages your debt repayment plan, allowing you to retain control of your assets while making regular installments to creditors over an extended period. 

52. What are the implications of debt review removal for an individual who co-signed on a debt (e.g., spouse or family member)? Will their credit report also reflect the removal?

Debt review removal primarily applies to the individual who directly participated in the program. However:

  • The co-signer’s credit report might still reflect the original debt even if the primary debtor exits debt review.
  • The co-signer remains liable for the debt if the primary debtor defaults after removal.

53. If one spouse in a marriage exits debt review, can it positively or negatively affect the other spouse’s credit score, especially if they have joint accounts?

Debt review removal by one spouse generally shouldn’t directly impact the other spouse’s credit score unless both parties were placed under debt review.

54. If an individual believes their credit report contains inaccurate information regarding debt review or the removal, what steps can they take to rectify the issue?

The National Credit Act (NCA) grants consumers the right to dispute any errors on their credit report. They can contact the credit bureau directly to initiate the dispute resolution process.

55. Does debt review removal automatically cover the settlement of any outstanding fees? (i.e debt counselling fees)

Debt review removal doesn’t automatically cover any outstanding fees associated with the debt review process.

Settling any outstanding debt counsellor fees is crucial to ensure a smooth and timely transition during the debt review removal process. This aligns with the National Credit Regulator’s (NCR) fee guidelines and minimizes the potential for delays or unnecessary objections.

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The National Debt Review Center

Welcome to The National Debt Review Center, where financial stability and integrity are our guiding principles. We strive to deliver the utmost best in customer service & act with the highest standards of integrity. We are South Africa's best Debt Counselling & Debt Review Removal Company. NCR Registration Number - NCRDC3106

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