I’m under debt review. I don’t understand where the PDA distributes the money.
When I started the application with my DC my balance 206000. This was in 2013. It’s almost a year and half now, and my balance is 209000.
They take R3300 of my salary to distribute. In August they deducted R3300. But on the statement it says that they deducted R67. The same for November.
Where did the rest of the money go? When I ask my DC he says he doesn’t understand.
What will happen if I cancel my debt review?
Thank you for your question.
I am not sure which PDA you are using, but the PDA should be able to provide you with clear statements. The statements will indicate what they have collected, and what they have disbursed to credit providers. They should also be able to show you exactly how what they have collected and disbursed measure against your repayment plan. From your specific problem it seems like there could be a technical issue. It might be the best thing to contact your PDA directly and not work through your debt counsellor at this point. If there’s an issue with an amount it’s possible that it was placed in a suspense account. Meaning that credit providers won’t receive funds. It’s therefore very important to address this issue without delay. You can rest assured that if the PDA has deducted funds it will not disappear. It will definitely be in one of the PDA accounts if it has not yet been disbursed.
Cancelling debt review is simple. A signed letter with an instruction for us to cancel is all it takes. A cancelation fee of 75% of the debt counsellor fee is payable if you have not yet paid your first instalment and we have calculated your payment plan.
When a debt review is cancelled, the original credit agreement is revived and the creditors are free to proceed to enforce their rights in terms thereof. That is why we urge consumers not to cancel without making prior arrangements with creditors. We often assist them to do so. First reach a written agreement with the creditor about the capitalisation of all payments in arrears and the resumption of the original instalments prior to cancelling your review and losing your protection.
What one must keep in mind is that debt review not only aims to get you debt free, but also to get you “rehabilitated” into the credit market again. “Rehabilitation” is achieved once you’ve brought all arrears up to date and are able to satisfy all your credit agreements according to the original contractual rates. This includes the original interest rate, the original instalment amount etc. Or when your debt has been settled. Should you exit the debt review prematurely, without reaching the point of “rehabilitation”, a clearance certificate cannot be issued.
I can almost guarantee you that your credit providers will litigate the moment you exit the debt review process. I would advise that you first bring the credit card and vehicle up to date before exiting the debt review process.
Have a great day.