How It Works

The Process of How Debt Review Works
1. THE CONSUMER APPLY

The Consumer apply for Debt Review by contacting Financial Debt Advisors, either by tellephonically, email or visiting our office.

2. THE FORM 16

Financial Debt Advisors will then issue the consumer an application form called the form 16, in which the consumer or Financial Debt Advisors can fill out(with the Clients permission) in order to see if the Consumer is over in-debted.

3. DOCUMENTS

If the client is over in-debted Financial Debt Advisors would then require a copy of the client’s South Africa Identity Document and Payslip.

4. OVER IN-DEBTED

Financial Debt Advisors has 30 business days, from the date of your application, in which to determine that the client is indeed over in-debted, Financial Debt Advisors usually takes 1-2 working days.

5. THE FORM 17.1

Within two business days of accepting the client’s application for debt review, Financial Debt Advisors must inform all creditors and credit bureaus of the consumers’ application. Financial Debt Advisors does this by sending the client’s creditors a prescribed form (Form 17.1) and calling on them to issue a certificate of balance (which is a “certified notice of the balance of a customer’s account, and accrued interest and charges, at the close of business on a specific date”) this can be sent to the client if the client request a copy.

6. THE NEGOTIATING

Financial Debt Advisors will now start negotiating with the creditors which will be submitted to a registered Payment Distribution Agency (PDA).

7. PROTECTION AGAINST BLACKLISTING AND REPOSSESSION

During the first 60 Business days from the date of the client’s application(form 16) to be placed under debt review, no legal action may be taken against the clients debts that are under debt review, basically this means that the client is protected against blacklisting and assets repossession. However if the clients’ creditors have already begun taking action against you before applying for debt review, then Financial Debt Advisors are unable to protect you from this( Although Financial Debt Advisors would still try its utmost best to protect you from this)

8. CERTIFICATE OF BALANCE

Within ten Business days of receiving a Form 17.1, the client’s creditors are required to provide Financial Debt Advisors with the certificates of the consumer account balances. This information helps Financial Debt Advisors to determine whether the consumer is over-indebted and will conduct an affordability assessment. The affordability assessment is aimed at working out how much the client can afford to spend on their monthly debt repayments.

9. THE FORM 17.2

Once Financial Debt Advisors has determine that the consumer is over-indebted and that the consumer is legally eligible for debt counselling, Financial Debt Advisors must notify the consumer’s creditors and credit bureaus by sending them a prescribed application, The Form 17.2

10. THE REPAYMENT PLAN

After Financial Debt Advisors has notified the consumer’s creditors, Financial Debt Advisors will draw up a repayment plan to rearrange the client’s monthly debt obligations in line of which the client is able to afford. Financial Debt Advisors must submit this plan to all the consumers’ creditors for their consent within 60 working days of receiving the application (Form 16) for debt review.

11. ACCEPTANCES

Once all the creditors has accepted Financial Debt Advisors repayment proposal, Financial Debt Advisors must obtain a consent order from the National Consumer Tribunal or a magistrate’s court within 60 working days

12. MAGISTRATE COURT

If for some reason any of the consumers’ creditors rejects Financial Debt Advisors repayment proposal, Financial Debt Advisors must refer the matter to a magistrate’s court with a recommendation, which Financial Debt Advisors will seek to have made an order of court. A magistrate can reject Financial Debt Advisors recommendation if they consider the proposal unreasonable. However the magistrate may give Financial Debt Advisors another chance to improve on the proposal.

13. THE PAYMENT DISTRIBUTION AGENCY

If the consumers’ creditors accept the repayment plan, or if a magistrate’s court agrees to the monthly repayment plan, a Payment Distribution Agency(PDA) will channel the consumers’ revised payments to the creditors. The PDA is responsible for providing monthly statements to the consumer and payment schedules to Financial Debt Advisors and the creditors.

14. THE DEBT FREE LIFE

Once all the consumers’ unsecured debt(Personal loans, Credit Cards, Clothing Accounts, Furniture Accounts) have been paid up, Financial Debt Advisors will issue the client with a clearance certificate and will notify all credit bureaus that the client is no longer over in-debted and that the client is no more under debt review. However if the client had judgements against them and Financial Debt Advisors was unable to remove these judgements, the judgements will still remain on the clients record for the remainder of the five year data retention period.

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