DebtSafe FAQ's


Our most frequently asked questions:

A: It is the employer’s choice on what the exact requirements are for their employees, so we will not be able to say definitively. However, historically we have seen that in general being under Debt Review is not an issue when looking for employment. The only industry that might have some question is if you are looking to be employed in the financial sector. Theoretically, there shouldn’t be discrimination towards someone in Debt Review when it comes to employment opportunities.

A: The National Credit Regulator (NCR) is the ‘regulating body’ of the South African credit industry. The regulator was established by the National Credit Act No. 34 of 2005 (referred to as ‘The Act’).

The regulator aims to encourage the development of an accessible credit market – mainly involving underprivileged persons, low-income individuals, and isolated communities. Credit bureaus, credit providers and debt counsellors are regulated and required by the NCR to comply with ‘The Act’.

A: If you completed your previous Debt Review successfully then it should be possible. 

But it is very unlikely that your second Debt Review will be granted if you failed to pay your first Debt Review instalments. The main reason for this is that you will still need to pay your first Debt Counsellor’s outstanding fees. Plus, your creditor will most likely not agree to any new repayment plan since the last repayment plan was not followed. 

A: The National Credit Act / NCA (also referred to as ‘The Act’) became fully operational on 1 June 2007. The Act aims to provide improved standards of consumer information and strives to promote a fair and non-discriminatory platform for consumer credit by regulating the process.

A: The National Credit Act (NCA) has been a subject of criticism due to its drafting and wording. The National Credit Amendment Act (NCAA) became operational on Friday, 13 March 2015 and contains the broadest changes to the Act to date.

A: The National Credit Act (NCA) must be read with the National Credit Regulations (the Regulations) promulgated in terms of the NCA (or ‘The Act’). The Regulations are complementary to their enabling sections in ‘The Act’. They provide for matters not specifically dealt with by sections of ‘The Act’. The Regulations became operational on Friday, 13 March 2015.

A: Due to the endorsement of the National Credit Act 34 (of 2005) in 2007, Debt Counsellors started their profession in the Debt Counselling industry. Debt Counsellors are required in terms of section 86(6) to conduct an assessment concerning the over-indebtedness of a consumer. Through the Debt Counselling or Debt Review process a Debt Counsellor, therefore, offers a responsible and regulated rehabilitation remedy to an over-indebted consumer or individual.

If the Court declares an individual as ‘over-indebted’ and the person goes under Debt Review, the Debt Counsellor needs to remain a person of trust and integrity. Typical tasks involve the following (but are not limited to): negotiating with creditors, taking care of the necessary registration processes and various behind-the-scenes administrative tasks.

A: Over-indebtedness refers to a situation when you do not have the means to meet all of your debt obligations or financial commitments at the end of each month. Read the following article to assist with further details about the concept: https://www.debtsafe.co.za/tips-to-erase-over-indebtedness/

A: It is your RIGHT to ask the relevant creditors (that declined your application) for insight into why the application was rejected.

And, you have the RIGHT to pull one free credit profile per year, investigate your credit profile and make sure that there are no irregularities on the profile that might affect your credit score in a negative manner.

A credit profile shows the credit providers what your credit health is as well as how you manage your credit/pay credit agreements.

It is, unfortunately, true that without a credit record the institutions cannot see that you are a good ‘payer of credit’, especially on a large amount.

Our advice as debt industry leaders will be to open a credit agreement (for example, a credit card or store card) and build your credit record in a controlled manner.

Keep in mind that while trying this method, you should always regulate your income, expenditures and debt amounts.

Good luck with (slowly but surely) building a good credit record. And, continue to sustainably manage your debt the way you have already set forth.

A: Many South African consumers are under the impression that the term ‘blacklist’ still exists, but there is, in fact, no such thing anymore. The word ‘blacklist’ should rather be replaced with the following: consumers that portray or have a bad credit record/profile.

The word ‘blacklist’ is sometimes evident in marketing campaigns to ‘frighten’ consumers. The word or concept has not been in use for a while now and this informal term was used during a time when credit bureaus only kept negative data or information on record about consumers’ ‘credit behaviour’. These days positive data also appears on a person’s credit profile.

A: A service agreement is an agreement where the service provider performs physical work (labour), services or responsibilities for or on behalf of the customer/consumer/client against compensation or payment.

Typical service agreements include gym memberships, phone, or data contracts, for example.

A: A credit agreement is a contract/agreement between a consumer and credit provider in which a credit provider offers a product or monies to the consumer. According to the National Credit Act (NCA) the consumer has to be given a contract (that explains the terms and conditions of the agreement) and a quotation (disclosing the total amount/fees payable under the specific agreement) by the credit provider on acceptance of the agreement.

The Act also defines a credit agreement as:

a)         a credit facility,

b)         a credit transaction,

c)         a credit guarantee, or

d)         any combination of the above.

A: A CREDIT PROVIDER enters into a credit agreement by lending money or offering credit to a consumer. It is of utmost importance that a credit provider must be registered under ‘the Act’ (NCA) and, with the National Credit Regulator (mostly referred to as the NCR).

According to ‘the Act’ (NCA): “in respect of a credit agreement to which this Act applies, means –

a)         The party who supplies goods or services under a discount transaction, incidental credit agreement or instalment agreement;

b)         The party who advances money or credit under a pawn transaction;

c)         The party who extends credit under a credit facility;

d)         The mortgagee under a mortgage agreement;

e)         The lender under a secured loan;

f)          The lessor under a lease;

g)         The party who advances money or credit to another under any other credit agreement; or

h)         Any other person who acquires the rights of a credit provider under a credit agreement after it has been entered into;”

A: A Section 129 Notice/Letter gives you notice to either bring your payments up to date, or, that you should consider the help of a resolution agent, the consumer court, ombud with jurisdiction, or apply for a debt relief process, such as Debt Review, within 10 working days. If you fail to respond within ten (10) business days of receiving this notice, and you have been in default of twenty (20) business days already, your creditor(s) will proceed to take or institute legal action against you, the consumer.

A: Alternatively known as the Debt Review Application Form.

This is your Debt Review Application Form as required by the National Credit Act (NCA). Your Debt Counsellor needs this form to assess your financial situation. Your Debt Counsellor will also be expected to verify the application’s information through supporting documentation from you and your creditors – just to double check that the information is accurate so that the best repayment plan can be prepared for you.

A: Alternatively known as the Cancellation Form.

Whether a Debt Review is cancelled voluntarily or involuntarily the National Credit Act (NCA) requires that a Debt Review Cancellation Form is completed.

There are serious considerations to make before cancelling your Debt Review. These include the following:

  • A cancellation fee of 75% of the debt restructuring fee is payable if you have not yet paid your first instalment and your repayment plan has been calculated.
  • The original credit agreement is re-established, and your credit providers are free to proceed to enforce their rights. This could lead to immediate legal action against you.
  • You will not receive your Clearance Certificate that clears your credit record.
  • It will be much harder to apply for Debt Review in the future.

A: Alternatively known as your Clearance Certificate.

This is your key to your new beginning and what you are working towards in your Debt Review. Your Clearance Certificate will be issued when:

  • All your accounts listed under Debt Review have been settled.
  • You are able to carry on with the original agreements you have with your creditors.
  • All your accounts are paid up, except for your home loan (your home loan must be paid up to date as per your Debt Review agreement).

Your Clearance Certificate will be sent to you and the credit bureaus, who are then required by the National Credit Act to clear your credit record.

A: Once your Debt Review application has been completed your Debt Counsellor is required by the National Credit Act to let your creditors and the credit bureaus know that you have formally applied for Debt Review.

This communication is done through a Form 17.1 and is sent to your creditors within 5 business days after the completion of your Debt Review application.

A: Your Debt Counsellor will do an in-depth evaluation of your financial situation to determine whether you legally qualify for Debt Review.

Once your Debt Counsellor has completed the evaluation they will send out a Form 17.2 which then states whether you are over-indebted and whether you would benefit from Debt Review. This form is then sent to your creditors and the credit bureaus.

A: When you are in arrears with a credit agreement, the In Duplum rule regulates the amount that you are responsible to repay to that creditor. Its aim is to prevent the creditor from demanding an unlimited amount (unlimited interest) of repayment from individuals who have fallen behind on their credit agreement.

There are two In Duplum Rules:

1. The common law In Duplum Rule.
2. The statutory In Duplum Rule in section 103(5) of the Act.

1. The Common Law In Duplum Rule:

Your debt’s interest will stop to run when the total amount of the arrear interest has accumulated into an amount equal to the outstanding principal debt.

So in the common law In Duplum Rule the amount repayable is:

  • The outstanding amount at the time when you fell behind on payments.
  • And interest equal to the amount of the outstanding amount at the time when you fell behind on the payment.

(If you have been charged the maximum amount allowed and then repay some, but not all, of the arrears, interest could be charged again until the maximum amount is reached once more).

This rule applies to:

  • Debt that isn’t a credit agreement.
  • Credit agreements entered into before 1 June 2007.

2. The Statutory In Duplum Rule

This Rule takes the creditor’s initiation fee, service fee, interest, credit insurance, default admin charges and collection costs into account when calculating the maximum repayable amount.

So, the amount you will have to repay is:

  • The principal debt that is still due at the time you fell behind on your payments.
  • Plus the above-mentioned fees, which will be equal to the principal debt that is still due.

Please note, however, there is still a disagreement between Debt Counsellors and Creditors on how this rule should be enforced. Therefore, the enforcement of this rule will be problematic until a Court provides a judgement about the rule and its implementation.

A: Creditors have the right to terminate your Debt Review when:

  • Payments are not received according to the payment plan.
  • The amount being negotiated is not accepted.
  • When a counteroffer is not accommodated.

In the case of a termination, DebtSafe will apply for reinstatement.

The biggest reason we have seen for a creditor to terminate a client’s Debt Review is that the client stops making their monthly Debt Review payments. Missing a Debt Review payment gives the creditor the legal standing to terminate the client’s Debt Review and in the worst case, begin with legal action against the client.

A: All credit agreements must be included in your Debt Review. The only exception is those credit agreements where the creditor has started legal action. But even then, you will have to let your Debt Counsellor know about the agreement so that it can be taken into account in your overall monthly budget.

(Very important. You have to disclose all your accounts to your Debt Counsellor, no account may be excluded.)

Furthermore, if you have a shared credit agreement (where you and your spouse, for example, both signed for credit) the person you share that agreement with will also have to apply for Debt Review with you in a joint application.

Regarding service agreements (like tax debt, municipal debt, school fees etc.). Usually, they are not included in your Debt Review, but still, need to form part of your overall monthly budget. There are however exceptions to this.

Each client’s debt and overall financial situation differs, so we would advise getting our free Debt Assessment where a DebtSafe Consultant will be able to determine how your Debt Review will be structured according to your various accounts and financial obligations.

A: Firstly, Debt Counsellors, as stipulated in the National Credit Act (NCA), are not allowed to manage their clients’ money. Rather, the NCA requires that a Payment Distribution Company (PDA) handles the collection and distribution of funds of Debt Review clients.

The three main reasons why the statements differ are:

  • Payments are processed at different periods. The PDA will distribute the funds to the creditors, and a couple of days after that the creditor applies the payment to the account.
  • The PDA statements include the Debt Review fees (link to that FAQ), whereas the creditor statements do not.
  • Creditor statements include the service fee whereas the PDA statements do not include creditor service fees.

Therefore, PDA statements should be seen as estimates. But, if a client is concerned about the difference in balance they should contact their Debt Counsellor to check if there are any discrepancies or issues that need to be addressed.

If you are a DebtSafe client with a question regarding your PDA statement you can use our updated MyDebtSafe Client Portal. MyDebtSafe will now allow for quicker responses and more efficient resolving of client issues. Please find the instructions to request a call back, or to escalate an issue on MyDebtSafe below:

Step 1: Navigate to www.mydebtsafe.co.za
Step 2: Login with your username and password.
Step 3: Navigate to “My Relationship Manager” in the top menu bar.
Step 4: On the left select “Create” to create a query.
Step 5: Fill in the fields, click “Send”.

A: Yes, you definitely can – don’t feel intimidated by creditors; you have the right to negotiate with them if you anticipate that you will be having trouble repaying your debt. Plus, being proactive will count in your favour.

Before getting everything ready for your negotiations, take the following into account:

  • Each creditor will want as much as possible. So you will have to show them that you truly only have a certain amount available and that your offer is reasonable considering your financial situation.
  • Most creditors will not be able to accept a pro rata amount on certain accounts (like a vehicle loan or home loan) and may require more than the pro rata amount in order for them to justify that you keep that asset.
  • Each creditor will have to be approached individually.

What you need before approaching your creditors:

  • A written motivation describing how your financial situation has changed, leaving you in a position where it is necessary to make new arrangements on your credit agreements. Also, add how you have tried your best to keep up with the payments by cutting out unnecessary costs.
  • A comprehensive budget that shows your cash flow exactly. On this budget, you need to show what money is coming in, and what all your expenses are (debt repayments, service agreements and essential living costs).
  • Calculate how much you can pay each creditor. During this calculation, you will need to prioritise the most critical accounts (like your home loan, car loan, rent etc.)
  • Decide for how long you will need leniency on your payments (remember, negotiating for a better repayment plan is only a temporary arrangement, like a few months, and not an option long-term)
  • Compile a repayment plan that specifies how much you propose to pay during the leniency period, and how you plan to catch up with the payments after the leniency period is done.

When you have the above in order you can draft a proposal for each creditor. Your proposal will contain your motivation, your calculations for that specific creditor and your proposed repayment plan for that specific creditor. Then, make an appointment with each creditor and present your case, point for point.

As mentioned above, this arrangement with your creditors is only a short-term solution, your creditors will not agree to a long-term repayment adjustment. So if you see that you will need reduced instalments for the foreseeable future you should consider Debt Review which will most likely be a better debt solution.


A: When in Debt Review all your current credit agreements are restructured into your monthly Debt Review repayments.  Furthermore, you are not allowed to acquire any new or additional credit during your Debt Review program.

With that said you will not be allowed to trade in your current vehicle below Debt Review for a new vehicle if it is linked to a new credit agreement.

You can, however, voluntary surrender  your vehicle while in Debt Review.

A: Debt Review is a great option for South Africans in serious financial trouble, still, they will need to consider the pros and cons of the program.

The Pros:

  • Consolidate your debt without having to add an additional loan to your debt mass.
  • Monthly instalments could be reduced by up to 60%.
  • Financial relief with the above mentioned reduced instalments.
  • Your home and car stay safe – No repossession, no legal action from your creditors.
  • You will be able to afford your family’s crucial living expenses.
  • Once the program is successfully completed you will enjoy complete financial rehabilitation with a clear credit record.

The Cons:

  • You will not be allowed to get credit while in the program.
  • Your Debt Review will be listed on your credit record until the completion of the program or when all your debt listed under Debt Review are paid up in full.
  • The payment period of your debt will be extended in order to lower your monthly instalments.

A: If your cell phone contract is included in your Debt Review budget you should be able to upgrade.

Make sure the monthly amount is not more than what is provided for in your budget. If the upgrade negatively affects your cash flow, it could have repercussions for your Debt Review. Always make sure that you are able to honour your Debt Review payments.

A: When entering Debt Review, and any credit agreement, it is important to make sure you have sufficient debt cover. This is called Credit Linked or Credit Life Insurance.

Depending on what Credit Linked/Life Insurance you have there should be some form of protection for your debt in the event of retrenchment.

With DebtSafe’s CreditGuard Plan your monthly debt repayments will be covered for a period of 12 months when you get retrenched. Over and above the retrenchment cover the CreditGuard plan also offers Temporary and Permanent Disability cover; cover in the case of death, ID theft and cover when on maternity leave.

Please speak to one of the DebtSafe Debt Counsellors about the benefits of the DebtSafe CreditGuard as well as the process on how to log a claim.

A: Yes, you can.

Surrendering your vehicle while your payments are still up to date:

Contact the creditor and give them a written notice that you want to surrender your vehicle. In five business days, you will have to surrender the vehicle to the creditor. Within ten business days of receiving your written notice, the creditor is required to provide you with an official evaluation of the vehicle (stating its value). The creditor will then sell your vehicle. If the creditor sells your vehicle for less than you owe on the car you will be responsible to pay the outstanding amount.

If you are dissatisfied with the evaluation provided by the creditor you can withdraw the notice and recommence the possession of the vehicle. You can also sell your vehicle privately to get a better price.

Surrendering your vehicle when you are behind on payments:

You can inform your creditors that you want to voluntarily surrender your vehicle. Once you signed the voluntary agreement your car will be repossessed.

When you surrender the vehicle during the debt review process – the correct procedure will be to suspend further payments to the creditor until the shortfall amount, if any, has been established. Whereupon, depending on the circumstances, repayment can continue.

A: Debt can only be written off by two means, namely Prescribed Debt and Reckless Lending.

Prescribed Debt

Debt has only prescribed if there has been no attempt by the credit provider to collect it or if no summons has been issued for the debt during the last 3 years. Also, if there has been no acknowledgement of debt during the last 3 years. If you have made any form of payment in the last 3 years it constitutes an acknowledgement of debt.

Prescription of debt is a defence; so, when the credit provider attempts to collect you can claim prescription as a defence. You will need to get an attorney to write a letter on your behalf to the respective credit providers notifying them that the debt has prescribed. If the debt has indeed prescribed already, the new Credit Amendment Act prohibits the prescription to be interrupted after 3 years.

The exception to the above-mentioned is Bond Accounts and Judgements – as the term for these are 30 years.

Reckless Lending

Reckless Lending is when a creditor has failed to conduct a thorough affordability assessment – as required by the National Credit Act (NCA) – at the time of giving the credit. It is also when the credit provider has given credit despite the fact that you did not understand the costs and obligations of the agreement, or when the credit agreement will lead to you becoming over-indebted.

At DebtSafe we offer the option to our new clients of conducting a Reckless Lending investigation.

A quick note about Credit Amnesty

Credit Amnesty was a once-off occurrence between April and June 2014 where the credit bureaus were forced to remove adverse information from credit records. In no way did Credit Amnesty write off people’s debt, it only removed outdated information from the credit records of people who have paid-up their debt.

A: You can log a dispute directly with the credit bureau where the wrong information is listed on your record.

If the wrong information is because of a specific creditor you can log a complaint with the Credit Ombud to dispute the listing on your record.

A: If you stay up to date with your Debt Review repayment plan your creditors will not be able to take legal action against you – including repossession.

Even with the above said, creditors could try to intimidate and threaten you (which is unethical and unlawful). When a creditor harasses you, you can take the following steps:

  • Record all details of the harassment.
  • Inform the creditor to contact DebtSafe.
  • Contact a DebtSafe Debt Counsellor and instruct them to open a Creditor Harassment Incident Report.

The DebtSafe Debt Counsellor will then handle the situation for you further.

Regarding vehicle repossession: Under no circumstances do you hand over your vehicle. Debt Collectors use illegal, dishonest, ways to trick you into giving up your vehicle. If confronted by them, do not sign anything and contact one of the DebtSafe Debt Counsellors immediately.

Repossession is only legal when a Warrant of Delivery is handed to you by the Sheriff, and not in any other circumstances.

A: The Credit Act requires that Debt Counsellors use an accredited Payment Distribution Agency (PDA) to manage their client’s money in order to prevent mishandling of funds which means your money stays safe.

Your accredited Payment Distribution Agency (PDA) handles the distribution of your money, and will also provide you with monthly statements. The PDA DebtSafe have partnered with is called Intuitive PDA.

A: It is very important to open a new savings account at a bank where you have no previous dealings. This is to prevent money grabbing by your current creditors.

Remember to inform your employer to pay your salary into your new, above mentioned, bank account. Also, note that it is your responsibility to cancel all current debit orders and advise the debit orders that will still go off about your new bank account details.

A: It would depend on the type of business. We can only assist you when your business is a sole proprietorship. We won’t be able to assist if your business is a Private Company (PTY) or Closed Corporation (CC) or a Business Trust.

A: There is no better feeling than receiving your Clearance Certificate (the proof to show that you have fixed your debt – an accomplishment that you have worked so hard for).

But, there are a few things that you should know before applying for credit again/after receiving your Clearance Certificate. One thing is certain – you should not rush into taking on more credit/debt again.

First things first – in theory, you should be able to apply for credit within a week of receiving your Clearance Certificate. But, we have seen that the process to clear your record can take longer than expected.

After the credit bureaus receive your Clearance Certificate each account in your Payment History should have a “Paid-Up” or “Closed” status. The credit bureaus will also make sure that your default listings and judgements against you are removed in the process. You will need to allow time for the credit bureaus to update their records. Give it a month after you have received your Clearance Certificate to see if the credit bureaus have deleted the Debt Counselling flag from your profile. If you see any discrepancies, take it up with the credit bureaus as soon as possible. Do note – according to the National Credit Act (NCA) your payment history is the only record that will remain on your credit record for two years.

On another note – credit providers do not always assist a customer who has come out of debt review directly. It is, therefore, important that you rebuild your credit score again first before borrowing from creditors. Your credit score will take some time to become good – as time passes your credit score will improve, and by a few months, it will be in a much better standing (but you don’t have to wait that long to apply for credit). We would suggest waiting three months before applying for new credit. It is important that you make sure that your credit score is good before applying for new credit because if your application for new credit gets declined, it negatively affects your credit score. It always remains the decision of the credit provider whether or not they want to extend credit to you. If they decline your credit application, you have a right to know exactly why they declined it.

Lastly, it is important not to take on too much debt or credit while improving your credit score again. We suggest that you start with small credit amounts (like a store account, for example). You, therefore, need to make sure that in order for you to improve your score or record, you must continually work on a personal debt management plan to make sure you service all of your obligations. Managing your debt is now more crucial than ever to avoid falling into over-indebtedness again.

IMPORTANT THINGS TO REMEMBER THAT WILL HELP YOU ALONG WITH YOUR NEW CHAPTER & FINANCIAL JOURNEY

**Here is a short-to-the-point illustration of a few crucial Do’s and Don’ts that you need to consider after you receive your Clearance Certificate:

DO’S –

Check your credit record one month after receiving your Clearance Certificate. It is essential to know whether your credit profile has been updated so that you can start improving your score as soon as possible.

DON’TS –

Ignore checking your credit record after receiving your Clearance Certificate. Rather not make assumptions…

DO’S –

Follow up with the credit bureaus if the Debt Review flag & default listings have not been removed within the reasonable time frame.

DON’TS –

Play the ‘ostrich’ and think that your listing will remove itself without communicating or following up with the credit bureaus.

DO’S –

Gradually build your credit score up before taking on new debt.

DON’TS –

Rush taking on new credit immediately after you receive your Clearance Certificate. You don’t want a creditor’s decline to affect your score negatively.

DO’S –

Apply for a small credit to help rebuild your credit score/improve your credit record.

DON’TS –

Take on more credit than you can afford, for example, high-interest debt.

DO’S –

Realise that it is the creditors’ choice to grant credit to you or not. If you get declined, you can ask for proof of ‘why’ as it is your consumer right to know.

DON’TS –

If you apply for new credit and get declined. Just take it on the chin and accept the feedback or outcome.

DO’S –

Continually implement your personalised 5 Step Debt Management plan to make sure you take on what you can afford and avoid over-indebtedness.

DON’TS –

Neglect managing your debt continually, or not setting a plan to keep your finances on track and your debt in check.

A: If everything is in order with your Clearance Certificate you and the credit bureaus should receive it within a few working days. Before issuing a Clearance Certificate DebtSafe will require paid-up letters from all you credit providers. This might take some time depending on the cooperation of your creditors and can sometimes cause a delay in the process.

A: Once an account is paid-up in your program the Payment Distribution Agency (PDA) will take the money that would have gone to that creditor and evenly distribute it towards the accounts that are left in your Debt Review program.

A: Yes, that is a great way to speed up your Debt Review program.

When you have extra income (like a tax repayment, a bonus or salary increase) you can contact one of the DebtSafe Debt Counsellors to make the arrangements for you. In this situation, you can also stipulate to which creditor you would like to make the extra payment. Important, do not pay it directly to your creditors without notifying a DebtSafe Debt Counsellor.

If you have enough extra cash to settle an account in full you are also welcome to do that. How to settle an account:

  • Contact the relevant creditor to obtain a final settlement figure.
  • Pay the creditor directly.
  • Send the proof of payment and paid-up letter to a DebtSafe Debt Counsellor so that they can remove the account from your Debt Review and recalculate your payment plan.

A: As a rule, no. It will be seen as reckless since being in Debt Review means that you are not able to pay your current debt. Therefore, the National Credit Act (NCA) prohibits you from acquiring any further credit while you are in Debt Review. Which makes sense since credit is what caused most of our clients’ debt.

The reason for this is that whilst under Debt Review your budget is calculated and precisely allocated to your current debt obligations and other living expenses.

But once you have successfully completed the DebtSafe program you will be able to apply for credit again.

The exception to the rule is a consolidation loan. Consolidation loans have strict application requirements. A reputable credit provider will do a full assessment in order to determine if you qualify for a consolidation loan while under Debt Review.

A: No, Debt Review is not a consolidation loan.

A loan means more debt. With consolidation loans, you only shift your debt from one place to another. Most people will not qualify for a consolidation loan. Unlike consolidation loans, which have very strict requirements (and at the end leaves you with more debt) Debt Review restructures your credit obligations to an affordable, consolidated, repayment plan.

Read more about the difference between our Debt Consolidation program and a consolidation loan here.

A: If you miss a payment it will give your creditors enough legal reason to terminate your Debt Review and begin legal action against you.

If you find yourself in circumstances where you see you might have trouble paying your next instalment you must contact one of the DebtSafe Debt Counsellors immediately to make arrangements.

Also, if your payments are in arrears no further work will be done on your application until payments are a 100% up to date (even if a payment arrangement was made).

A: In certain cases, we will be able to assist.

But it would depend on that person’s situation. To be viable for our program they would need a stable income to start with. Other factors that will need to be considered first are the amount of debt they have, the type of debt they have, what their living expenses are and their marital status.

A: No. Debt Collection is when an attorney, a person who is an agent of an attorney or a registered debt collector collects, on behalf of the credit provider, an outstanding amount plus lawful interest, admin costs and collection fees, which by law is capped to certain amounts.

A: Yes, all debts must be included in the DebtSafe program. The only debt that may be excluded (but what you still must tell your Debt Counsellor about) is if your creditors have sent you a Summons before you applied.

A: If you received a Summons before entering Debt Review we will not be able to include that account in your Debt Review.

However, we can try to convince that creditor to take part in the Debt Review, but ultimately it will stay the creditor’s decision whether or not they want to participate.

A: No, Debt Review is not the same as Sequestration.

What is Sequestration?

Sequestration entails that you, a natural person (as stated by the Insolvency Act), are bankrupt.

You get two types of Sequestration:

  • One – Compulsory Sequestration – when you can’t pay your debts, leading to your creditors applying for your estate to get sequestrated.
  • And two – Voluntary Sequestration – when you willingly apply to the High Court for sequestration/to be declared insolvent.

**For more information and help with the above process, please contact an authorised insolvency lawyer to assist you.

What the process entails:

START

Debt Review

Free assessment done by a registered Debt Counsellor to confirm over-indebtedness.

Sequestration

Application to the High Court for Sequestration/to be declared insolvent.

What the process entails:

PAYMENT PLAN

Debt Review

Consolidated repayment plan to pay off your debts & a budget to enable you to service your living costs in the process.

Sequestration

The court will appoint a trustee to manage your money and distribute the benefits from the sale of (mostly all of your) assets in your estate.

What the process entails:

PROTECT ASSETS

Debt Review

Protection of your assets (such as a vehicle or house) against your creditors.

Sequestration

With Sequestration your assets are sold to cover your debt. In order to meet the criteria for Sequestration, you will need to cover 100% of your secured debt (typically a home loan or an instalment sale agreement) and 20% of your unsecured debt (typically personal loans, credit cards and overdrafts) as well as the costs of the Sequestration.

What the process entails:

REACHING THE END OF THE PROCESS & THE WAY FORWARD (TAKING ON DEBT AGAIN)

Debt Review

Clearance Certificate – the proof that you receive indicating that you have paid off all of your debts.
As soon as all paid-up letters have been received, you and the credit bureaus will receive your Clearance Certificate Your Debt Review flag, plus any default listings, need to be removed from your record (according to the National Credit Act) by the credit bureaus.
However, your payment history will still reflect on your credit profile for a period of two years as per the conditions of the National Credit Act (NCA).

Sequestration

You may bring an application to be rehabilitated, usually within 4 years after your date of Sequestration. This entails another court application; however, it is not a complicated one. If no creditors prove claims, you can rehabilitate within 1 year. Note – this is not the norm.
If you do not bring the application, you will automatically rehabilitate after 10 years.
You cannot get credit before your rehabilitation.

What the process entails:

HOW LONG DOES THIS PROCESS TAKE?

Debt Review

Debt Review is a rehabilitation and proven program that is personally structured according to your situation and according to the amount of debt that you owe (differs time-wise from person-to-person).
DebtSafe can provide you with a free debt assessment which will provide you with an estimate on how long your specific Debt Review program can/will take. (CTA)

DebtSafe can provide you with a free debt assessment which will provide you with an estimate on how long your specific Debt Review program can/will take.

Sequestration

Sequestration is completed within a 1 – 10 year period, depending on several factors.
The consequence of Sequestration can be far-reaching, depending on your specific situation and circumstances involving your insolvency.

The difference between Debt Review & Sequestration – shortened illustration:

Difference

Debt relief method / debt management solution

Debt Review

Sequestration

Difference

Regulated process

Debt Review

Regulated by the National Credit Regulator (NCR) – the governing body of the credit industry under the National Credit Act (NCA)

Sequestration

The process is regulated by the Insolvency Act

Difference

Losing your assets during the process

Debt Review

Sequestration

Difference

You get the opportunity to pay off all of your creditors

Debt Review

Sequestration

Difference

Hefty legal fees

Debt Review

Sequestration

Difference

Process duration

Debt Review

Depends on your personal circumstances

Sequestration

1 – 10 years depending on your personal circumstances

Difference

After the process, your salary is yours

Debt Review

Sequestration

Difference

You can take on new debt after the program

Debt Review

Sequestration

Difference

Average % of debt paid off

Debt Review

100% plus interest.

Sequestration

100% of secured debt, 20% of unsecured debt.

A: No. Administration only pays your creditors every third month, the rest of the payments go towards admin fees and commissions. Plus, Administration is only for a debt of R 50 000 or less.

Lastly, Administration exclusively deals with unsecured debt. So, your secured debt, like a home loan or car loan is not included.

A: You are insolvent when your liabilities are more than your assets. When considering your assets, you include all income, properties, vehicles, cash in the bank, investments etc. Liabilities are all your debt.

If you want to remain solvent, you must be in a position where your assets are more than your liabilities. When you are insolvent, you can apply for sequestration, which is a process where your assets are sold to offset your liabilities.

Usually, your creditors must get a specific percentage of the proceeds of the sale of your assets. After this, you will not be able to apply for credit for five years, after which you can apply for a rehabilitation order. There are alternatives such as Debt Review, which you should consider first before applying for sequestration.

A: Our program is created by South Africa’s National Credit Act. Therefore, the only way we can assist non-citizens with their debt is:

  • if you have a passport number,
  • can prove that you are permanently working in South Africa, and
  • your debt is with South African creditors.

A: Unfortunately, we do not.

To be able to qualify for Debt Review/Debt Consolidation/Debt Counselling you must be employed or receive regular and consistent income. No creditor will accept a non-payment as a viable option during our negotiations with them.

If you are unemployed you can, however, negotiate with your creditors directly to see if they can offer you some sort of breathing space for a few months. Pay them as far as you can and do not stop looking for employment. If too much time passes and you still do not have employment, they will Summons you. You will then be able to explain to the court that you are unemployed, and you can ask the court to give you 3-6 months to find a job. Do not stay away and ignore the Summons. Show up at the court and state your case.

A: First, we would recommend that you pull your credit record to see what it looks like and whether it is in good standing or not. It is also a good idea to check your credit record regularly to make sure everything is as it should be.

If you see that there are accounts whose status are in arrears you will have to pay the arrears, and then make sure that you keep up to date with those accounts going forward.

If you have Judgements or Administration Orders on your profile you will need to settle the outstanding debts in order to have that information removed.

Avoid applying at various creditors for credit in a short period of time, this will affect your score negatively. Furthermore, every time you apply for credit and it gets disapproved it also negatively impacts your credit record.

The best way to improve and keep your credit record in good standing is by paying the full instalment that is due on time every month and checking your credit record on a regular basis.

A: You can check your credit record with any credit bureau. There are mainly four credit bureaus in South Africa. They include; TransUnion, XDS, Experian and Compuscan.

By law, you are entitled to pull your credit record for free annually.

A: If you are unhappy with the service your Debt Counsellor is providing, or not providing, you have the option to change and transfer to a Debt Counsellor of your choice.

A: The process of cancelling/withdrawing from Debt Review is a complex one and we will always suggest that you talk to your Debt Counsellor before making the decision. Here is what you need to know about exiting Debt Review before completing the program:

Your Debt Review will stay listed on your credit record until a Clearance Certificate is issued. You can only receive a Clearance Certificate when:

    1. All debts are paid in full, or.
    2. When all short-term credit agreements, including car finance, have been paid up and you are only left with a home loan which is not in arrears in terms of the Debt Counselling Re-Arrangement Order – plus, you must be able to pay your original home loan instalment, or
      You can withdraw from Debt Review prior to a Form 17.2 (prior to being declared over-indebted according to the National Credit Act).

But once the Form 17.2 is issued you will need to approach a Court and get them to rescind your over-indebtedness so that you can be declared as NOT over-indebted. Only when your Debt Counsellor receives this Court Order stating that you are no longer over-indebted will they be allowed to remove the Debt Review listing from your name.

A: The Debt Review program is structured according to your marriage contract.

Married in community of property (married COP)

The application to the program will be a joint one and all the debt will be thrown into one pool since the law sees you as one estate.

Your income will also be joined in the calculations and the payment of all your debt will be joint into one single instalment. Both will be placed under Debt Review in a joint application.

Married out of community of property (married ANC)

When you are married out of community of property both parties do not have to go under Debt Review.

If, however, there are debts which both signed for and are therefore both responsible for, then both will have to apply for Debt Review. No account may be excluded from the program.

Marrying someone in Debt Review

When marrying someone already in Debt Review it would depend on your marriage contract.

If you are married in community of property (married COP) you will then also need to apply for Debt Review.

If you are married out of community of property (married ANC) then you will not be obligated to apply for Debt Review.

Divorce and Debt Review

If you already have your Debt Review Court Order that Court Order will have to be rescinded if you were married in community of property (COP) or in the case of a joint Debt Review application. Then you will need to re-apply for a new Debt Review program with a new debt profile and repayment plan separate from your ex-spouse or partner.

If your Debt Review Court Order has not been granted yet you will also need to re-apply if you were married in community of property (COP) or in the event of a joint application. Your new application will be separate from your ex-spouse or partner and based on your personal debt profile.

A: The DebtSafe Head Office is situated at 42 Van Riebeeck Road, Mokopane, Limpopo.

DebtSafe does, however, operate nationally, so we can assist you anywhere in South Africa. With our extensive attorney correspondent network, we are confident we can help wherever you are situated.

A: The duration of your program with DebtSafe will be subject to;

  • The amount of debt you have.
  • The type of debt you have.
  • Your income.
  • Your essential living expenses.
  • What we can negotiate with your creditors.

How long your program will take is unique to your situation, therefore, we recommend asking for your free, no-obligation debt assessment. This will give you an estimate on the duration of your program.

Important note: Once you are in the Debt Review program and receive extra money you are always welcome to arrange with one of the DebtSafe Debt Counsellors to allocate those funds to a creditor in order to reduce your program’s duration.

A: Your monthly repayment plan’s instalment will depend on your individual debt profile. What affects your monthly instalment is:

  • The amount of debt you have.
  • The type of debt you have.
  • Your income.
  • Your essential living expenses.
  • What we can negotiate with your creditors.

Your monthly instalment will be unique to your situation; therefore, we recommend asking for your free, no-obligation debt assessment. This will give you an estimate on what your instalments will be when in our program.

A: Debt Review is a professional service and does require certain fees.

However, there are no up-front fees. All our fees are paid from your instalments and form part of your restructured payment plan.

The fees are regulated by the National Credit Regulator (NCR) and are the same for all Debt Counsellors. There are six types of fees;

  • Once-off Application fee
  • Once-off Debt Counsellors fee
  • Once-off Legal fee
  • Monthly Payment Distribution Agency (PDA) fee
  • Monthly Aftercare fee
  • Once-off Reckless Credit Check fee

Some of the above-mentioned fees will be unique to your debt situation since they are determined by your monthly debt repayment instalment. Our free debt assessment (no obligation required) will provide you with a clearer outline of what your specific fee structure will look like.

A: To qualify for the DebtSafe program depends on various factors. But, foremost you will have to be seen as over-indebted, as defined by the National Credit Act (NCA). In short, being over-indebted means that you are unable to pay your monthly financial obligations.

Other factors that influence whether you qualify for DebtSafe’s program includes the following:

  • Your income.
  • The type of debt you have (secured/unsecured debt).
  • The amount of debt you have.
  • Your living expenses.
  • Your marital status.

DebtSafe offers a free, no obligation, debt assessment to determine whether you would qualify for our program.

A: The National Credit Regulator (NCR) is the official governing body that regulates and monitors the Debt Counsellors who are registered with the NCR.

If your Debt Counsellor takes consumer rights and lawful practices seriously they will be registered with the NCR.

The Debt Counsellors of DebtSafe are indeed registered with the NCR. On top of that, DebtSafe has been helping South Africans with their debt from 2009 which makes DebtSafe a well-established company with many years of experience to offer.

Here is DebtSafe’s managing director’s NCR registration number:
NCRDC1078. You are welcome to visit the NCR website to check the registration.

A: DebtSafe helps South Africans struggling with their debt through a program called Debt Review (also referred to as Debt Consolidation or Debt Counselling).

In short, our program reworks your debt repayments into an affordable, consolidated repayment plan – meaning your debt repayments are made into one single, reduced repayment.

Your repayment plan is formulated in such a way that it enables you to pay your debt as well as pay for essential living costs (school fees, food, rent, commute etc.), giving you immediate financial breathing space.

Your repayment plan is agreed upon by your creditors (we negotiate with them on your behalf), is regulated by the National Credit Act (NCA) and authorised through a Court Order. This means that our program legally protects you, and your assets (car and home), against creditors who want to take legal action against you.

Once you have successfully completed your DebtSafe program you will receive a Clearance Certificate. This is sent to you and the credit bureaus. The credit bureaus will then remove the Debt Review flag from your profile as well as all your default listings. Your payment history will however still reflect on your credit profile for the period of two years as per the conditions of the National Credit Act (NCA).