Debt Collectors and Prescribed Debt
Did you know that you don’t have to pay prescribed debt? Let’s be honest. Many of us can’t even keep up with our current debt payments. Wouldn’t you rather spend the money you have on your active debt — instead of using it to pay old debt?
Debt collectors may not try and collect old debt
In 2015, amendments to the National Credit Act (NCA) made it unlawful for any credit provider or debt collector to sell or try to collect payment on prescribed (old) debt.
Yet, according to Shepherd Silayi, Senior Debt Review Manager at National Debt Advisors (NDA), this has not stopped them from calling people morning till night for payments on a gym contract from 2006 and a credit card from 2012. Debt collectors are unrelenting in their drive to collect these payments.
“Most debt collectors get commission when they get you to make payment and will often tell you that, if you pay just a R20 or a R50 on this old debt, legal action will be stopped. This is a disgusting tactic, that consumers should avoid falling prey too.
When they get you to acknowledge old debt, and you pay even the smallest amount on it, then you revoke your prescription — and that means that you are liable for the entire amount once again.”
What to do if debt collectors call
The best thing to do is to tell the debt collector that you don’t acknowledge this debt, as you think it has prescribed. Then ask the debt collector for a full statement of your account and tell them to show you where you made payment in the last 3 years. Alternatively, they must give you proof of legal action taken against you on that account in the last 3 years.
If they can’t do that — inform them that you know your debt is prescribed and tell them to stop harassing you. If they don’t stop — report them to the Council for Debt Collectors (CFDC). We advise you to email them at firstname.lastname@example.org and put all your communication in writing. That way you have a record of all of your conversations.
Old debt may also NOT reflect on your credit report. It must be written off by the credit provider and removed from your credit profile. If they don’t do this themselves, you can contact the credit provider and let them know that you think the debt has been prescribed and needs to be removed.
Please note: It is not your responsibility to prove that you don’t owe the money. The debt collector or credit provider must prove that the debt is not prescribed, or that you DO owe the money.
If your debt has not been prescribed and it is still active, do the right thing and pay it. If you can’t afford to repay the monthly instalments on the outstanding balance, contact a debt counsellor. National Debt Advisors has more than 30 counsellors registered with the National Credit Regulator (NCR) and considered one of the top 10 national debt counselling firms. You can trust us to help you find financial freedom.
A final word of caution, if we may, we all have to stop making debt to keep up with the Joneses. If you can’t afford it, don’t buy it.