Debt Counselling

The main purpose of a Debt Counsellor

* Act as a mediator between credit providers and indebted customers.

* Assess a customer’s state of indebtedness.

* Facilitate debt rearrangement with credit provider.

* Make recommendations to credit providers and/or magistrates’ court on behalf of indebted consumers.

In the current economic cycle many individuals are struggling to cope with debt. The same debt that was easy to manage previously is becoming too much to handle with cost of living increasing and income shrinkage month on month.

Banks and other creditors have been very aggressive in lending to consumers, but the consumer is finding it very difficult to make full monthly payments to creditors. Many consumers are finding that they are over in debt and cannot manage their monthly debt payments anymore.

Thanks to the National Credit Act that came into effect in June 2007, there is an alternative to help people manage their debt. Over in debt consumers can now apply for debt counselling with the help from the National Credit Act.

Debt Counselling will protect the over in debt consumer from aggressive creditors who are quick to take legal action and not always willing to listen or understand the consumer’s problem. Debt counselling will protect the consumer from creditors taking legal action. In many cases the consumer and creditor benefits from debt counselling.

The consumer benefits, because he gets to pay more manageable monthly payments and the creditor benefits from not having to take expensive legal action. Most of the times not recovering any debt at all. So the banks are also looking for alternatives to repossession and don’t want to repossess your assets unless they need to.

Debt Counselling Process

A consumer who cannot make regular payments to his creditors under the agreements they signed, can apply for debt counselling.

* The consumer applies for debt counselling with the help of a debt counsellor or consultant. The...