You may find your balances increasing in the first few months of debt review. Do not panic.

This is process- related and will change. In South Africa, credit providers, banks, debt collectors and debt counsellors are not always technologically aligned.

And Covid 19, with all the changes it’s brought about in the work environment – has not helped things. Rest assured that your balances will be reduced. You will soon be paying less per month – and you will become debt free.

Debt review is not a quick-fix solution to your debt problems. Falling off the system after a few months makes no sense.
Becoming financially free requires you to stay committed to the process, make your payments timeously and trust us as your debt counsellors.

Debt counsellors will negotiate with your creditors for lower interest rates and extended terms and will present them with a proposal for these new terms. Creditors can either accept or reject the proposal. As SA’s leading debt counselling company, we have developed sound relationships with creditors and other industry roleplayers – and have an excellent success rate with the acceptance of proposals. However, this process does take time to resolve, accepted by all parties and put into motion.

The system of cascading payments is utilized by most debt counsellors. This will see your smaller debts being settled first, and the funds allocated to these debts will then go towards the remaining debt. Most people start seeing significant changes in their balances around six months after they have started the debt review process.

It is important to note, that you are also protected by the In Duplum rule. Section 103(5) of the National Credit Act limits the amount that may be recovered from you by a creditor if you have defaulted on your credit agreement. The maximum amount that can be collected by the creditor, is double the capital amount outstanding at the time you defaulted, including any interest or collection costs.

For example, if you defaulted on a personal loan of R10 000, end up owing interest and costs of another R11 000 and repay only R3 000 of the capital, the maximum amount that could be recovered would be the unpaid capital of R7 000.

This, together with interest and costs up to a maximum of a further R7 000. If however, the interest and costs only add up to R4 000 then the maximum that could be claimed would be R7 000 plus R4 000.

Your initiation fee, service fee, interest, cost of credit insurance, default administration charges and collection costs – may not exceed the unpaid balance of the principal at the time that you defaulted.

Through the In Duplum rule, the National Credit Act protects you from debt collectors continuously adding interest and fees to your account – and far exceeding the initial amount owed.

Overwhelming debt can be the source of great stress, but that should end when you make the decision to become financially free through the process of debt review.

You have started the process – now commit to it, make it a part of your life and let us handle the rest. It is what you are paying us to do.

Should you feel uncomfortable or unsure about anything – please contact us immediately.

Relax. Don’t panic. We’ve got you.