FAQs

Can You Get New Credit During Debt Review?

Short answer:

No you cannot. Here’s why, what the National Credit Act says, and safer options to manage cash without breaking your debt review.

Long answer:

Why No New Credit?

The goal of debt review is to restructure a consumer's debt to make it more sustainable and to set them on a clear pathway to becoming debt-free. Part of this is to help the consumer rethink their financial habits. Taking on new credit while you are busy with this process would be highly counterproductive and would jeopardise your entire journey towards financial freedom.  So No, you can’t legally take new credit while under debt review. Your profile is flagged, and credit providers must not extend new loans or facilities to you until you complete the process or are lawfully removed from review. This protects your repayment plan and prevents back-sliding into unaffordable debt.

Debt review exists to stabilise your finances: you make one affordable consolidated payment, interest and fees are managed, and collections pressure is reduced. Taking new credit during this period competes with essentials and your debt-review instalment, raising your risk of default and potential termination of the protection you currently enjoy.

Legal Limitations

South Africa’s National Credit Act (NCA) limits fresh borrowing while you are under debt review. Section 88(1) of the National Credit Act (NCA) 34 of 2005 prohibits incurring further charges under a credit facility during debt review, and credit providers are expected to respect the debt review flag on your profile. Giving you new credit can amount to reckless lending. In terms of section 88(1) of the NCA, a consumer must not incur any further charges under a credit facility whilst under debt review. When a consumer applies for a debt review, they are flagged as 'under debt review' on their credit profiles, which credit providers will see. Credit providers must respect this.

Any credit provider who extends credit to a consumer flagged as under debt review is deemed to be engaging in reckless lending. On completion, Section 71 provides for a clearance certificate (Form 19) which expunges the review flag at bureaux so you can re-enter normal credit activity. Venturing beyond the legal boundaries by obtaining additional credit during debt review could catapult individuals into compromising circumstances. It might lead to the termination of the debt review process, casting away the protective mechanisms it provisions.

What happens if you try anyway?

If you attempt to take new credit while under debt review the following can happen:

  • Can prompt creditors to terminate the debt review for default and resume legal enforcement at original rates/terms.

  • Risks court action and higher costs, undoing months of progress.

  • Often stems from emergencies, of which you can solve the cash-flow gap differently (see next section)

Safer alternatives to access cash (while compliant)

  • Build a micro-emergency buffer (R1,000–R3,000) in a simple savings pocket with instant access.

  • Sinking funds for predictable annual costs (licensing, school uniforms, tyres).

  • Income boosters: overtime, weekend gig, selling unused items and ring-fence 30–40% to your buffer.

  • Expense trims: subscriptions, prepaid data, meal planning; redirect savings to your buffer.

  • Talk to your debt counsellor before any big change. Debt Counsellors can review your budget or propose settlements on small balances if a lump sum becomes available. (This keeps you compliant and on track.)

FAQs

Can I open a store account or increase my overdraft?
No. New or increased facilities are not allowed during debt review. 

When can I apply for credit again?
After your debt clearance certificate is issued and registered with credit bureaus, the debt review flag is then removed. 

What if a lender offers me a small loan anyway?
That may be reckless lending; decline and report concerns to your debt counsellor or the National Credit Regulator (NCR). 

What happens if my debt review is terminated for non-payment?
You lose protections and creditors can enforce original terms and take legal action. 

Is there a legal way to exit debt review before completion?
This is conditional due to legal limitations. In limited cases via court rescission if you are no longer over-indebted. Otherwise, exiting debt review is only possible when you have completed paying off all your accounts registered under debt review and a debt review clearance certificate (Form 19) is issued. Get legal advice.

Conclusion 

Obtaining new credit during debt review is a hard no. However, there are options to manage shocks and finish strong. If you would like, our debt counsellors can review your budget, set up micro-savings, and map out lawful early-settlement tactics.

 

 

 

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