Long answer:
Can I Change My Debt Counsellor While Under Debt Review?
Key Takeaways
- Yes, you can change debt counsellors, but only with a valid reason and the proper steps.
- Never stop payments to your creditors during the switch process, if there is a debt review court order in place.
- Seek legal advice or help from the NCR if you feel trapped or unfairly treated
Introduction
Many South Africans under debt review find themselves frustrated when their debt counsellor does not deliver the support or communication promised at the start. The good news is that you can switch to a better debt counsellor during the process but it is not as simple as changing your mind and moving on. Understanding the legal steps, timing, and possible consequences will help you make the best decision for your financial future.
What Happens If I’m Already Under Debt Review with Another Debt Counsellor?
When you sign up for debt review, you trust a debt counsellor to guide you through the entire process until you’re debt-free. But what happens if you are unhappy with your current debt counsellor? Maybe you feel neglected, you’re not getting updates, or your repayments aren’t managed correctly. The good news is that it is possible to switch, but there are strict rules and important steps.
Is It Legal to Change Debt Counsellors in South Africa?
Yes. The National Credit Regulator (NCR) allows you to switch debt counsellors if you have valid reasons such as poor service, mismanagement, or if your counsellor closes down. However, the process is not as simple as just signing with someone new.
When Should You Consider Switching Debt Counsellors?
Poor Communication
If your debt counsellor ignores your calls and emails or never provides updates on your case, it’s a major red flag. Regular, clear communication is essential to protect you from creditor harassment and missed payments. When your counsellor goes silent, you’re left in the dark — risking legal action or repossession you could have avoided with timely advice.
Mismanagement of Payments
One of the biggest reasons people switch counsellors is poor handling of payments. If your monthly debt review instalments are not correctly distributed to your creditors, your accounts may fall into arrears again. This can lead to threats of repossession, increased interest, or court action — exactly what debt review is designed to prevent. If your creditors are still phoning or sending final demands, it’s time to investigate whether your debt counsellor or Payment Distribution Agency is doing their job.
Non-Compliance
Always check if your debt counsellor is registered with the National Credit Regulator (NCR). If you discover that they are operating without registration, have been deregistered, or are facing serious complaints with the NCR, this is grounds to change providers immediately. Working with a non-compliant counsellor can leave you unprotected if your creditors decide to pursue legal action.
Business Closure
Sometimes debt counsellors shut down their practice without making proper arrangements for their clients. If your debt counsellor closes shop and you’re not sure where your file is or who’s handling your case, your debt review protection could lapse. In this situation, moving to a reputable, active debt counsellor ensures you stay under the legal shield of debt review, keeping your assets and peace of mind intact.
If any of these apply, switching debt counsellors might protect your finances and give you peace of mind.
How Does Switching Debt Counsellors Work?
Here’s what you need to know:
1. Find a New Registered Debt Counsellor
Choose a reputable, NCR-registered debt counsellor. Ask questions about their fees, communication style, and how they will manage the transfer.
2. Get Consent and Necessary Documents
Your new counsellor will request a Form 17.7, which is a voluntary withdrawal from your current debt counsellor. Your old counsellor must co-sign this form to release you from their care. Important: If your current counsellor refuses or ignores the request, you can lodge a complaint with the NCR.
3. Notify Creditors and the Payment Distribution Agency (PDA)
Your new counsellor must inform all your creditors, the PDA handling your repayments, and the courts (if your debt review is already court-approved) that they will now manage your plan.
4. Keep Payments Up to Date
Continue paying your debt review instalments as agreed especially if there is a court order in place. Stopping payments during the switch could lead to creditors taking legal action.
What Are the Legal Risks of Switching Debt Counsellors?
Switching debt counsellors mid-plan has some risks:
If you stop paying while switching, creditors may terminate your debt review and start legal action.
If you don’t follow NCR guidelines, your new plan might be rejected by the court.
A dishonest counsellor might delay the handover, so keep detailed records and lodge complaints if needed.
Can You Cancel Debt Review Instead?
Some people think cancelling debt review and starting fresh with a new counsellor is easier. But beware: you cannot simply cancel debt review once your plan is approved by the court, unless you settle all your debts or the court declares you no longer over-indebted. Always seek advice before trying to exit your plan.
How Much Does It Cost to Switch Debt Counsellors?
If there is a court order in place, there are no NCR fees to switch. The debt counsellor is obligated to continue with the debt review and pay your accounts as stipulated in court order.
If there is no court order in place, your new debt counsellor will charge an administration fee and restructuring fee for taking over your debt review application. Always confirm costs upfront. Additionally, there may be legal costs for the purposes of processing court documents.
How Long Does Switching Debt Counsellors Take?
On average, switching debt counsellors can take 4 weeks, depending on how quickly your previous counsellor cooperates. Urgent cases (e.g., if your old counsellor closed down) can sometimes be fast-tracked.
How to Protect Yourself When Switching:
- Check your new debt counsellor’s NCR registration.
- Get everything in writing. Keep copies of Form 17.7, Certificate of Balances, and court documents.
- Keep paying on time. Don’t give creditors a reason to cancel your debt review.
Should You Switch Debt Counsellors?
Switching debt counsellors should be your last resort. To avoid it:
- Do thorough research before signing up — check NCR registration, read reviews, and confirm that they’re linked to a reputable Payment Distribution Agency (PDA).
- Ask clear questions upfront — how often will they communicate with you? Do they have a dedicated customer service team?
- Keep records of all interactions — emails, payment confirmations, and agreements should be stored safely.
Conclusion
Switching debt counsellors in South Africa is possible, but it can be tricky. It’s vital to understand the legal process, prepare your documents, communicate clearly, and get the right advice. With the right steps, you can continue your journey to debt freedom with a team that supports you every step of the way.
Switching isn’t always easy, but if you’re not receiving proper help, it could save you stress, money, and even your assets in the long run. At Debt Sage, we specialise in helping clients who want to switch safely and stay protected. We’ll manage your handover, communicate with your creditors, and update your court order so you can continue your journey to financial freedom.
Do you need help changing debt counsellors? Talk to our friendly team today for clear, professional guidance.