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Answer for Why is my debt review payment increases every year by 10%?

Hi there.

Thanks for your question.

Annual reviews forms part of debt review best practices, but is not enforceable by law. Most debt counsellors do work a 5% or 10% increase into the repayment plan in order to get the consumer out of debt quicker. If interest rates are high, things might go slow in the beginning, but as the capital is reduced gradually, the interest applicable will also reduce gradually and the reduction of the debt will be accelerated toward being settled. 

If you apply annual increases it accelerates the process even further. If you cannot however afford the increase, you need to communicate this with your debt counsellor ASAP. They are under no obligation to apply an increase, and they can keep it the same for you.

With regards to the missed payment: You should attempt everything to get hold of your debt counsellor and have them implement a new payment plan. You will have to catch up the arrears, simply because missing a payment gives the credit providers the right to terminate your debt review immediately. At least you can explain the situation and will be able to motivate with your debt counsellor. They will be able to make arrangements with your credit providers.

Kind regards