Long answer:
Apply as soon as you can see that your income minus essential living costs can’t cover your contractual debt instalments. Waiting until after legal enforcement begins can limit your options and raise costs. Early action unlocks one affordable repayment, reduced interest/fees, and legal protection while you repay. Here are the key signs that it might be time to consider debt review, also known as debt counselling:
How to know it’s time (quick self-check)
Use these practical signals as a yes/no checklist:
Cash-flow test fails: After rent/bond, transport, food, utilities, school costs and medical needs, you don’t have enough left to meet debt instalments. That’s textbook over-indebtedness under the National Credit Act (NCA). When your total debt seems insurmountable and if you don't have enough money left for your living expenses after your loan instalments have been deducted from your net salary, it might be time to seek professional help. Not sure whether you're over-indebted? Use our Debt Calculator to find out.
Arrears are growing: You’re rolling payments, short-paying, or skipping accounts to “catch up next month.” If your accounts are two months or more in arrears and you find it hard to pay your monthly bills, with your debt constantly piling up, it's a sign you should consider debt review.
Section 129/default letters: You’re receiving final demands or s129(1)(a) notices. These often precede summons and enforcement. Don’t wait. If you've received final demand letters from your credit providers (also known as Section 129 notices and you're getting endless calls from debt collectors and lawyers, you're at risk of losing your assets. Entering debt review protects you from legal action like garnishment orders or repossessions.
Collections pressure: You’re fielding calls from multiple collectors and feel you’re losing control. If debt is causing you significant stress or anxiety, or affecting your well-being, debt review can help you enter a clear path to becoming debt-free, giving you peace of mind.
No workable budget: You’ve cut non-essentials, but the maths still doesn’t balance. If you lack a structured budgeting plan that works and makes provision for all your debts, and your financial life feels chaotic, a debt counsellor will be able to assist you with drawing up an actionable, realistic budget.
Asset risk: Vehicle balloon looming, mortgage arrears, or a threatened repossession/garnishee.
If two or more apply, speak to a registered Debt Counsellor now.
Why earlier is better (and cheaper)
More accounts can be included: If a credit provider already started legal enforcement before you apply, that agreement may sit outside the plan (NCA s86(2)). Early application avoids this exclusion risk.
Lower stress and fees: Entering review before judgments or repossessions helps limit legal costs and restores predictability.
Faster path to a court/tribunal order: The sooner you apply, the sooner a formal rearrangement order can lock in affordable terms and protect you. Industry guidance targets early filing within the first 60 days of the process.
What debt review actually does
Debt review (debt counselling) is a regulated NCA process for over-indebted consumers. A registered Debt Counsellor assesses your budget, proposes a single affordable repayment that covers all eligible credit, negotiates with credit providers, and seeks a court/tribunal order confirming the new plan. Payments then flow via a Payment Distribution Agent (PDA) to each creditor in line with the order.
When your debts are settled according to the order, you receive a clearance certificate (Section 71), and the “under debt review” flag is removed by credit bureaux.
The best time to apply (typical scenarios)
Scenario A: “The maths just broke”
You’ve trimmed Netflix, eating out, and data bundles—but still can’t meet instalments. Apply now. This is the classic affordability failure the NCA was designed to fix by consolidating your repayments.
Scenario B: You received a Section 129 notice
A s129 default letter generally arrives before litigation. Applying immediately can still secure a rearrangement order and prevent escalation—don’t wait for a summons.
Scenario C: Irregular income (overtime/commissions dried up)
If your base income can’t support your current debt load, apply before arrears spiral. A counsellor can recut the plan around your true, sustainable income.
Scenario D: Balloon/residuals coming due (vehicle finance)
A looming balloon often tips a workable budget into crisis. Early review can restructure the shortfall and protect essential transport.
Scenario E: New life costs (baby, rent increase, medical co-pays)
As soon as a lasting cost increase hits, reassess. If the budget no longer fits, apply now and avoid default.
“How late is too late?”
If court enforcement already started on a specific credit agreement before your application (after proper s129 processes), that credit may not be included under s86(2). You can and should still apply—your counsellor will (a) include all other eligible credit, (b) budget for the excluded item, and (c) try to negotiate pragmatically. Earlier is always better.
Who qualifies?
You’re a natural person with credit agreements regulated by the NCA.
You’re over-indebted or will become so without intervention (NCA s79 assessment).
You have income (salary, pension, rental, etc.). Debt review restructures repayments; it doesn’t erase them.
What happens after you apply (timeline)
Apply (Form 16) → Acknowledgment
The counsellor captures your credit profile, income and expenses.Notice to all creditors (Form 17.1)
Sent within five business days of acceptance to alert providers that you’re under assessment.Proposal → Negotiations → Court/Tribunal
The counsellor proposes a new plan and seeks an order. Industry guidelines emphasise timely filing (target within ~60 days) to give everyone certainty.Single monthly payment via PDA
You pay one instalment; the PDA distributes per the order.Completion → Clearance certificate (s71)
Bureaux remove the review flag once the certificate is filed.
Benefits of applying on time
Legal protection from piecemeal enforcement once the order is granted.
Affordability: a single instalment that fits your budget.
Lower interest and fees (negotiated, then confirmed by the order).
Predictability: fixed debit date, fewer surprises.
Health & wellbeing: reduced stress and fewer collection calls.
Common myths—busted
“I must be in months of arrears first.” No. Apply when the cash-flow test fails; earlier is better.
“Debt review ruins my credit forever.” No. After completion and Section 71 clearance, the flag is removed and you can re-enter normal credit activity.
“I can apply with zero income.” You need some income because you’ll still be repaying under the new plan.
What to prepare before you apply (checklist)
Last 3 months bank statements and payslips (or proof of income).
Full list of all credit agreements (cards, loans, store accounts, vehicle, bond).
Proof of essential expenses (rent/bond, transport, utilities, school fees, medical).
Any s129 notices, arrears letters, summons, or repossession threats.
Details of non-credit obligations (municipal rates, taxes, maintenance) so they’re in the budget even if they’re not in the court order.
Here are the key signs that it might be time to consider debt review, also known as debt counselling:
Things to Keep In Mind
So you've decided that debt review is for you. That's great — and you're taking the first step towards getting back control of your finances! However, to benefit maximally from debt review, you need to keep the following in mind:
- Legality: You need to make sure that your chosen debt counsellor is registered with the National Credit Regulator (NCR). Debt review is tightly regulated by the National Credit Act (NCA), setting clear and transparent guidelines for the service, and using an NCR-registered debt counsellor ensures that you have the full legal protection that debt review offers you.
- Implications: Understand that under debt review, you won’t be able to take on additional credit. Instead, your debt counsellor will work with you to create a realistic budget that helps you live within your means.
- Costs: Be aware of the costs involved in the debt review process, including the debt counsellor’s fees. These should be explained to you transparently and in detail by your debt counsellor. Costs are tightly regulated by the NCR.
If you seek debt review at the right time, your assets will be protected from legal action, you'll be able to manage your debt more effectively, and you'll set yourself on a pathway to financial stability. Still not sure whether debt review is for you? Read about the advantages and disadvantages of debt review.
FAQs
Is there a best time of the month to start?
Yes: immediately once you see you’re short. Your counsellor will align your first consolidated debit with salary dates and ensure creditors are notified in sequence. (Many providers expect the first payment in the month the proposal is agreed.
Can all my accounts be included?
Most NCA-regulated credit can be included. Debts already in enforcement before your application may fall outside per s86(2). Your counsellor will still budget for them and negotiate where possible.
When will the “under debt review” flag fall off?
After you complete the plan and your counsellor files the clearance certificate with bureaux (within seven days).
Conclusion
Apply for debt review as soon as affordability fails, ideally before legal enforcement begins. Early action gives your counsellor the most room to restructure credit, secure concessions, and protect you with a court-backed plan. With one payment, a realistic budget, and clear timelines, you can stabilise quickly and work toward your Section 71 clearance.
Free 10-minute assessment: Share your last three month bank statements and any Section 129 or summons should you have been served any. We will confirm eligibility and map a tailored, affordable plan today.