What is Debt Counselling?

If you ever found yourself deep in debt and then turned to the internet for a solution, you would find much information on a service called Debt Counselling, otherwise known as debt review.

Debt Counselling is a formal legal process that allows a consumer to be declared over-indebted and for a Debt Counsellor to negotiate a restructured payment plan to creditors; and obtain a court order confirming the new repayment plan.

If you are over-indebted, a debt counsellor can negotiate with your creditors on your behalf to get lower interest rates and reduced monthly instalments. This makes your debt more manageable and teaches you accountability as your agreement with your debt counsellor can fall away if you miss a payment.

But debt counselling is not the only game in town, and many people ask “What about debt consolidation?”