What happens if I miss my debt review payment?

If you miss a payment under your debt review, it can have serious implications.

1. Debt review is a legal process, and your payment plan has been accepted by all your creditors. If you default on your plan, you are breaking your agreement and your creditors are within their rights to initiate legal proceedings.
2. If you have assets, you run the risk of losing your home or your car.
3. If you miss a payment and do not let your debt counsellor know, your creditors will issue you with a Section 129 letter which confirms you are in arrears. This will be followed by a summons and if ignored leads to a default judgement.
4. It is at this point that a warrant of execution is issued, and your car can be repossessed and sold at auction to cover some of your debt. If you do not have a car to sell you will be required to attend court where the magistrate will review your income and expenses and make a ruling on what you must pay to each of your creditors. If you do not stick to this ruling a garnishee order can be issued where the money is taken from your salary before it reaches your bank account.
5. Consistently missed payments can strain relationships with creditors and have a significant emotional and psychological impact.

If you find yourself in circumstances where you see you might have trouble paying your upcoming instalment amount, you should contact your debt counsellor immediately to re-negotiate and make arrangements with your creditors. Your debt counsellor can look at the options that are available to you. If your circumstances have changed such as you have a reduced income, then your counsellor can apply to your creditors for a re-negotiation.

Remember, the intention of debt counselling is to get you debt-free and provide peace of mind. It’s always advisable to keep your debt counsellor informed throughout the process.

Got More Questions? We have gathered the most frequently asked questions about debt review here.

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