Debt Review – A consumer friendly breakdown

You Kept up with the Joneses and now you’re up to your ears in debt with no hope of relief.

Luckily for you, the National Credit Act is there to ease your burden.

Without bombarding you with all the legal jargon and technical terms, here is the consumer-friendly break down of what Debt review, also known as Debt Counselling, can do for you.

In June 0f 2007 the National Credit Act (NCA) and the National Credit Regulator (NCR) came into effect and introduced Debt Review, a formal and closely managed debt solution, to assist over-indebted consumers struggling with debt.

An over-indebted consumer is simply a normal everyday Jane and Jo who can’t pay their debt instalments anymore and who are living beyond their means. In today’s society, it is no difficult feat to fall into the debt trap.

Debt review restores your bank balance and ensures that you can afford to pay your debt obligations and have enough money to cover the rest of your living expenses. The Joneses don’t even need to know.

If you can relate to Jane and Jo’s financial stress, you need to contact a debt counsellor. It is the first step to financial freedom.

A Debt counsellor restores the balance by reviewing your Budget and then negotiating with your creditors for lower interest rates and instalments. Before 2007 you, the consumer, had limited negotiation power, but luckily the National Credit Act and your Debt counsellor have your back and their main goal is to ensure that you can honour your credit agreements and still have enough money to live your life.

When an agreement between your debt counsellor and creditors are reached, the Debt Counsellor applies to the court to ensure that the new payment plan is made an order.

When under debt review, you are legally protected by the National Credit Act (NCA) and creditors are no longer allowed to harass you. The important thing to remember is that you are protected against your creditors taking legal action if you stick to the monthly instalments set out in your debt -Re-arrangement Order.

So, the next time you start feeling overwhelmed by your debt remember that there is a way out of the debt trap.