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DEBT REVIEW REMOVAL ATTORNEYS IN SOUTH AFRICA

REMOVAL FROM THE DEBT REVIEW PROCESS

Time and again, we receive queries and instructions from credit consumers who want to exit the Debt Review process. Of course, exceptions are due to personal circumstances, but in most cases, we have discovered two reasons why people want to exit debt review earlier than the due time:

First and most eminent, it comes as a rude awakening to most people soon after being under debt review that they can no longer access credit. In some instances,  consumers are not made fully aware of the consequences of going under debt review.

Secondly, we have been instructed numerous times before that some Debt Counsellors explain only the form (as well as the benefits) and not the effects of Debt Review to consumers, thereby presenting it as Debt-Consolidation.

While Debt Review and Debt Consolidation may appear to have the same goal, they are fundamentally different. Debt consolidation is accessing a lump sum credit facility to settle all other accounts and only remaining with one significant monthly obligation towards that one lump-sum account, although it attracts certain disadvantages. On the other hand, Debt Review is a mechanism commenced by an application under section 86 of the National Credit Act 34 of 2005, after which:

  • none of the consumer’s creditors may institute any legal proceedings in an attempt to absolve the debt owing to them by the consumer;
  • the consumer’s access to further credit from a reputable and accredited credit provider is restricted; and
  • debts restructured and monthly obligations catered for with the consumer’s income have consideration for the consumer’s essential living expenses or any residual or additional income.

As alluded to above, consumers have varying reasons why they would want to exit the Debt Review process earlier and wonder if this is possible. This will all depend on the stage reached and how far the process has gone. Here are the scenarios and options available.

OPTIONS AVAVAILABLE FOR WITHDRAWING FROM DEBT REVIEW

Firstly, a consumer may withdraw from the Debt Review process before the application has been granted by the Court by withdrawing for the process, despite the consumer having completed the Form 17.1. This withdrawal deprives the consumer of the protection of legal action by creditors. The attempts to restructure the debt fall away, and the consumer’s obligation to repay the creditors as per contractual terms is revived.

Secondly, if the Debt Counsellor accepts a consumer’s application for Debt Review and the consumer has been declared over-indebted, another option would be to present sufficient evidence to convince the Court that the consumer is not longer over-indebted. This application will be by the Debt Counsellor to seek the debt restructuring and declaration of over-indebtedness being made an Order of Court.

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In the third instance, if a Court Order has been issued declaring the consumer over-indebted, the consumer may, under no circumstances, exit debt review early. This was held in the case of Van Vuuren v Roets And Others; Nel v Roets And Others (2019) ZAGPPHC 428. In that case, the Court held that it does not have authority to release a consumer until the full obligations under the arrangement certified by a Court Order have been settled. The only way is for the consumer to settle all structured debt and have a Clearance Certificate issued by the Debt Counsellor, after which the credit bureaus must remove the debt review flag from the profile of the consumer. Please note that this does not apply if the consumer is only left with one long term account e.g property bond.

INSIST ON DEALING WITH EXPERIENCED DEBT REVIEW REMOVAL ATTORNEYS TO SUCCESFULLY TERMINATE THE DEBT REVIEW PROCESS.

The above are the options that a consumer has should they decide to exit Debt Review earlier than anticipated. As can be seen, the processes are fraught with legal and technical hurdles; we strongly advise consumers to seek our assistance should they decide to embark on the options above. Further, since the legislative authorities had envisaged that consumers would endure the whole process until their debt is rehabilitated, provisions for exiting the process before the due time are not as easy without legal assistance. This is why we at Burger Huyser Attorneys, assign our capable, professional, diligent and astute attorneys with extensive experience to assist our clients in not only Debt Review matters. Kindly contact us for comprehensive assistance.

NEED TO CONSULT WITH TOP DEBT REVIEW REMOVAL ATTORNEYS IN SOUTH AFRICA? CONTACT OUR DEBT REVIEW REMOVAL EXPERTS TODAY.

Choose Burger Huyser Attorneys as we have gained vast experience in dealing with Debt Review removal matters over the years. We pride ourselves on delivering a discreet and confidential service, whilst ensuring you obtain the best possible outcome.

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