Statistics continue to indicate that more South Africans are drowning in debt. Not many people are aware of the range of debt relief options available, however there are several professional debt relief options available to help you reduce or get rid of your debt.
Various solutions include:
Debt settlement
This involves you or a debt settlement company negotiating lump-sum settlements with your creditors. You’ll have to do your research to find a reputable, professional and successful company.
Debt consolidation
This means that you take out a loan, which you use to consolidate and pay off all your other debts. What makes this option attractive is the possibility of a single lower monthly repayment at lower interest rates.
Credit Counselling
You work with a credit counselling agency that reviews your budget and helps you evaluate your credit standing.
You can contact the National Credit Regulator on 0860 627 627 as well as the National Debt Mediation Association on 086 111 6362
Sequestration
When sequestration occurs, the consumer surrenders their estate to a curator who will sell all their assets and use the proceeds to pay off their debt. Once 40% or more of the debt has been paid the balance of all the consumer’s debt is written off and the consumer starts over with a clean slate.
Debt Counselling
A debt counsellor creates a budget to calculate how much an over-indebted consumer can afford to pay their credit providers and creates a payment plan for the consumer to be able to pay all their creditors. Not everyone is eligible to apply. To qualify, you’ll need to be classified as over-indebted – unable to pay off your debts on time.
Voluntary arrangements
If a consumer’s debt is not too secure, they can try to make voluntary repayment arrangements directly with their credit providers.
Other debt relief options include bankruptcy as well as a debt management plan.
