WHEN TO APPLY FOR DEBT REVIEW guide

Applying for debt review, also known as debt counselling, is a step to consider when you find managing your debts overwhelmingly difficult. Here are signs that it might be time to consider applying for debt review.

1. Inability to Meet Monthly Obligations

If you are struggling to pay your monthly installments and you don't know what to do. If your accounts are 2-3 or more months in arrears. If you find it hard to pay your monthly bills and debts constantly pile up it might be a sign to consider debt review.

2. final demand letters and legal action

If you have received final demand letters from credit providers (Section 129) and lawyers. If you are getting endless calls from credit providers and lawyers demanding payment. Creditors are threatening to take legal action, such as garnishments or repossessions, debt review can help manage the legal aspects and the debt.

3. Over-Indebtedness

When your total debt seems insurmountable and way beyond your total earnings, it might be time to seek professional help. If after deducting your household living expenses from your net income you have less cash left over than the monthly installments on your debt then you may apply for debt counselling.

4. Lack of a Budgeting Plan

If you lack a structured budgeting plan that works, and debts seem chaotic, a debt counselor can assist in structuring a practical budget.

5. Stress and Anxiety

If debt is causing significant stress, or anxiety, or affecting your well-being, it might be beneficial to consider debt review for peace of mind.

Things to Keep in Mind

• Legality: Ensure the debt counselor is registered and compliant with the National Credit Regulator (NCR).
• Implications: Understand that under debt review, you won’t be able to take on additional credit. To unlock financial freedom you must understand the advantages and disadvantages of debt review.
• Cost: Be aware of the costs involved in the debt review process, including the debt counsellor’s fees.

Seeking debt review at the right time can help in managing debts more effectively, preventing legal actions, and setting a pathway to financial stability. If you feel overwhelmed by your financial situation, it could be helpful to seek advice from a debt review professional to explore your options.

 

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