Struggling with Debt? Here’s How to Qualify for Debt Review in South Africa
Struggling with debt? Learn how to qualify for debt review in South Africa. This includes income requirements, legal status, and how to get started with a debt counsellor.
The National Debt Review Center
Here’s How to Qualify for Debt Review in South Africa
If you’re overwhelmed by debt and drowning in monthly payments, debt review can be a lifeline. But before you apply, it’s important to understand the qualifications. Here’s a breakdown of what you need to know:
The Basics
- Debt review is a legal process overseen by the National Credit Regulator (NCR) that helps you manage and repay your debt.
- A debt counsellor negotiates with your creditors to lower your interest rates and monthly instalments, making your debt more manageable.
Who Can Qualify for Debt Review?
- You must be 18 years old or older.
- You must have a demonstrably consistent income, whether from employment, a pension, or other reliable sources.
- Your debt must be from South Africa.
- If you’re married in community of property, your spouse will need to agree to and be part of the debt review process.
- You must be over-indebted, meaning you cannot reasonably afford to repay all your debts. A debt counsellor will assess your financial situation to confirm this.
- You cannot be under sequestration (a form of bankruptcy) or already under debt administration.
Additional Points:
- There are no restrictions on being blacklisted or having accounts in arrears.
- You’ll need a South African bank account to receive your income.
Next Steps:
If you meet these qualifications and are interested in debt review, the best course of action is to contact a registered and reputable debt counsellor like The National Debt Review Center. They will assess your situation, explain the process in detail, and guide you through the application.
Remember: Debt review isn’t a quick fix, but it can be a powerful tool to regain control of your finances. By understanding the qualifications and seeking professional help, you can take the first step towards a debt-free future.
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Debt Review Calculator
Frequently Asked Questions
What requirements are for debt review?
Age: 18 years or older.
Income: Consistent and demonstrable income to afford repayments.
Debt Location: Debts must be from South Africa.
Marital Status: Spouse’s consent needed for married couples in community of property.
Over-Indebtedness: Struggling to meet monthly debt obligations.
Legal Status: Not under sequestration or debt administration.
No Current Legal Action: No summons issued by creditors.
Who doesn’t qualify for debt review?
Individuals under 18.
People with no consistent income to make repayments.
Those whose debts originate outside of South Africa.
Married couples in community of property where the spouse disagrees.
Individuals who can comfortably afford their debts.
People already under sequestration or debt administration.
Those with active legal action (summons issued) against them for debt.
How do I get into debt review?
Contact a registered debt counsellor.
The counsellor will assess your financial situation.
If eligible, they’ll help you with the application process.
Who qualifies for debt counselling in South Africa?
Age: 18 years or older.
Income: Consistent and demonstrable income to afford repayments.
Debt Location: Debts must be from South Africa.
Marital Status: Spouse’s consent needed for married couples in community of property.
Over-Indebtedness: Struggling to meet monthly debt obligations.
Legal Status: Not under sequestration or debt administration.
No Current Legal Action: No summons issued by creditors.
Can debt review be rejected?
Yes, debt review applications can be rejected. Reasons might include not meeting the qualification criteria, incomplete applications, or unrealistic repayment proposals.
Is debt review a good idea?
Debt review can be a good idea for those struggling with over-indebtedness. It offers a structured approach to managing debt, lowers interest rates, and reduces monthly instalments.
However, it also comes with limitations on accessing credit and requires commitment to the repayment plan. Consider seeking professional advice from a debt counsellor to determine if it’s the right solution for your situation.
Do you have a credit score if you are under debt review?
Yes, you will still have a credit score while under debt review. However, the debt review listing will likely cause your score to drop.
How much do you pay for debt review?
Debt counsellor fees are regulated by the National Credit Regulator (NCR).
The exact cost depends on the debt counsellor and the complexity of your situation.
However, there are limits:
For single applications, the fees cannot exceed R8,000.
For joint applications (married couples in community of property), the maximum fee is R9,000.
How long is the debt review process?
The length of the debt review process varies depending on your debt amount and the agreed repayment plan. Here’s a general timeframe:
Unsecured credit (credit cards, personal loans): 12 – 60 months
Vehicle finance: 84 – 118 months
Home loan: Up to 240 months
Do I qualify for debt counselling?
While I can’t definitively say if you qualify, here’s a self-assessment to see if it might be helpful:
Are you over 18 years old?
Do you have a consistent income source?
Is most of your debt from South Africa?
Are you struggling to meet your monthly debt obligations?
Are you not currently under sequestration or debt administration?
Do you have no legal action (summons) against you for debt?
If you answered yes to most of these questions, then debt counselling could be a viable option.
Debt can feel overwhelming, but there are solutions available. If you’re struggling to keep up with your monthly payments, debt review in South Africa can offer a path to financial freedom. By understanding the qualifications, costs, and timeframes involved, you can make an informed decision about whether it’s the right option for you. Remember, seeking professional help from a registered debt counsellor is crucial to navigate the process and develop a sustainable debt repayment plan. With commitment and guidance, you can overcome debt and achieve a brighter financial future.
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