How much does a Debt Counsellor cost

Published by The National Debt Review Center on April 25, 2024April 25, 2024

The cost of a Debt Counsellor can vary depending on the specific situation, your new reduced installment and the total debt owed. However, the National Credit Regulator (NCR) in South Africa has established guidelines outlining the fees that debt counsellors can charge.

Table of Contents

Application Fee

This is a flat fee to cover the costs of the debt counsellor to process the completed debt Review application.

Regulated Cost – R50 vat exclusive

Payment Due Upfront and in full.

Administration Fee

The Debt Review administration fee is a regulated once-off flat fee which gets charged by the debt counsellor. This fee is for administering the following processes:

Consultation with the consumer. The consultation is the explanation of the Debt Review process and an explanation of the regulated fees.
Notifications to credit providers advising them that the consumer has applied for debt review. Also, known as the Form 17.1 Process
Capturing the consumers’ details on the NCR Debt help system
Attending to any debt Review rejections (17.2 rejection) which will include
Notifying the consumer and credit providers and the rejection
Updating the NCR Debt help system
Compliance with regulation 25. Regulation 25 of the National Credit Act: If a debt counsellor finds that a consumer is not over-indebted and makes a finding in section 86(7)(a), the debt counsellor must provide the consumer with a letter of rejection

Regulated Cost – R300 vat exclusive

Payment Due Upfront and in full.

Debt Counselling Restructuring Fee.

The Fees under debt counselling are aligned to the outcomes of a full assessment of the consumers’ financial information and the following processes include:

Proposal preparation for credit providers’ perusal
Restructure the consumers’ debt on the debt counsellors PDA profile
Negotiations with creditor providers which includes
Negotiate reduced instalments
Negotiate reduced interest rates.
Reduce or change insurances
Submit final proposals to credit providers and the consumer
Drafting, submitting and supplying of debt counselling documents to attorneys to draft court applications.
Updating the NCR Debt help system
Attend to any transfer request from consumers
Attorney instruction to draft court applications
Filling of NCT applications in the cases of consent orders
Attending to withdrawal request from consumers (17.W process)

Costs – The restructuring fee is equal to the distributable amount of not more than R8000 for a single applicant and R9000 for consumers married in community of property.

If your new reduced installment is R1500 the restructuring fee & Legal fee will also be R1500. This means that you won’t be required to pay anything beyond the quoted amount, as all fees are already included in this new figure.
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In other words, the first restructured instalment will get paid to the debt counsellor. The above limits apply

Payment Due: This first payment will get paid over to the debt counsellor for services rendered.

Reckless lending fee.

A debt counsellor will attend to Reckless Lending Assessments and investigations and supplying reckless lending documents to attorneys to draft affidavits on the assessment outcome.

Cost R1500

After Care Fee.

Debt counsellors will track your debt counselling progress and attend to the following while you under debt review.

Form 17.2
Review of the consumers’ financial situation
Attend to any payment queries
Attend to the clearance process which includes securing paid up letters
Attend to the 17. W process. (withdrawal from debt counselling by the consumer)
Attending to the update of the NCR debt help system

Costs: 5% of the distributable amount or an amount of not more than R450 per month.

Aftercare fees will never exceed R450. If the amount exceeds R450pm query the amount with the debt counsellor and the NCR.

Payment Due monthly will get deducted from the debt Review restructured amount.

National Consumer Tribunal Submission Fee.

A debt counsellor will submit your debt counselling application with the NCT to get a consent order.

Costs R 621.14 once-off and this is excluding the NCT filling fee. Currently, the NCT filing fee.

Attorney Legal Fees

Equivalent to your monthly restructuring amount should your matter be reffered to the Magistrate Court.

A monthly Transactional Payment Distribution Fee (PDA) as per the NCR

Note: You will not pay for Attorney Legal Fees if your matter is sent to the National Consumer Tribunal visa versa if your matter is sent to the Magistrates Court. You will also not pay the Reckless Lending fee if you did not instruct the debt counsellor to investigate reckless lending.
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