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How long does debt review last?

by | Jan 27, 2022 | FAQ blogs, Personal Finance

How long does debt review last? It lasts as long as it takes to pay off your debt – and a good debt counsellor will ensure that that is in less than 5 years.

Most over-indebted consumers take between  36 and 60 months (3 – 5 years)  to become debt free, whilst on the debt review program. Don’t let this time – frame scare you off. Everyone’s circumstances are different. There are many people  who pay off their debt  and become financially free, far quicker than that, while they are under debt review.

 

Here, is some of what determines how long debt review lasts

  • How much money you owe
    Consumers who owe more, generally take longer to pay off their total debt, than those who owe less
  • How much you are able to repay per month
    The more money you earn and the fewer your expenses, the more money you will have left after paying for necessities, to pay towards your debt installments
  • The interest rates you have to pay on each debt
    The higher the interest rate, the more money you have to pay on what you owe. The more the interest, the longer it will take to settle your debt, and the longer you will be under debt review.
  • The new repayment plan your debt counsellor negotiates
    A registered, experienced  debt counsellor will negotiate with your creditors to ensure the best possible repayment plan for you. This might include lengthening of repayments terms, which will mean that you stay on debt review for longer.
  • How committed you are to repaying your debt
    The more payments you skip, the longer it will take to repay all your debt. Skipping repayments while you are under debt review is one of the worst things you can do. Creditors will be able to take legal action against you, and this could then lead to the repossession of your assets.

 

The sooner you can pay off all your debts, the sooner you can become financially free. This is how you can do it:

  • Earn more money to pay more debt
    Get a second job or a side hustle and work overtime or extra shifts. Sell unwanted goods, and taking risks into account –  consider renting out an unused room in your house
  • Scale down and spend less
    Make changes to your lifestyle and cut down on your unnecessary spending. The money you save can go towards paying your debt off sooner
  • Use extra money on debt repayments
    If you receive extra money via a bonus, 13th cheque, policy payments or  tax returns – consider sacrificing some luxuries and rather paying off your debt sooner.

 

If you have any extra funds to pay towards your debt, get in touch with your debt counsellor and discuss the best way for you to become debt free – sooner rather than later.

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