Debt Review - Everything you need to know
Are you feeling overwhelmed by mounting debts? Struggling to make ends meet each month? It's time to take control of your financial future with debt review—a powerful solution designed to help you regain financial stability and peace of mind.
What is debt review?
Debt review is a legal process that assists over-indebted South Africans in managing and eventually getting out of debt. A qualified debt counsellor assesses your financial situation and negotiates with creditors to restructure your debt repayments, making them more affordable. This process ensures that you can meet your monthly obligations without sacrificing essential living expenses.
Did you know: with Meerkat, you can save up to 50% on your monthly debt repayments!
♦♦ Read more What is debt review?
Is debt review a good idea?
Below is a list of reasons why debt review is a good idea
Protection from Legal Action and Harassment Debt review offers you legal protection, preventing creditors from taking legal action against you while you are under debt review. This means no more threatening phone calls or letters, allowing you to focus on repaying your debt in a structured and manageable way.
Consolidated and Reduced Monthly Payments One of the significant benefits of debt review is the consolidation of your debts into a single, reduced monthly payment. Your debt counsellor negotiates with creditors to lower interest rates and extend repayment terms, easing your financial burden.
A Clear Path to Financial Freedom By following a debt review plan, you commit to a structured repayment process. This disciplined approach not only helps you clear your existing debts but also instils better financial habits, setting you on a path to long-term financial health.
No Additional Debt During the debt review process, you are not allowed to take on any additional debt. This is often seen as a disadvantage of the debt review process, but it actually ensures that you focus solely on repaying your existing obligations, preventing further financial strain.
If you are already struggling to pay your debt, chances are you won't get approved for a loan anyway.
Watch this video with Founder & CEO of Meerkat, David O'Brien as he unpacks the debt review process:
How Does Debt Review Work?
Step 1: Assessment
Your debt counsellor conducts a thorough assessment of your financial situation, including your income, expenses, and debts. This helps determine whether you qualify for debt review and allows the counsellor to develop a tailored repayment plan.
Step 2: Notification to Creditors
Once you decide to proceed, your counsellor notifies all your creditors and the credit bureaus that you are under debt review. This immediately halts any legal actions and debt collection efforts against you.
Step 3: Proposal Development
Your debt counsellor negotiates with your creditors to reduce interest rates and restructure your repayment terms. A proposal is drafted outlining the new repayment plan, which aims to make your monthly payments more affordable while ensuring all creditors are paid.
Step 4: Court Approval
The repayment plan is submitted to a magistrate's court for approval. Once the court grants a consent order, the new terms become legally binding for all parties involved.
Step 5: Monthly Payments
You start making the agreed-upon monthly payments to a Payment Distribution Agency (PDA), which then distributes the funds to your creditors according to the court-approved plan.
Step 6: Progress Monitoring
Your debt counsellor regularly reviews your progress and adjusts the repayment plan if necessary. This ensures that you stay on track and can make any necessary adjustments in response to changes in your financial situation.
Success Stories
Debt review has transformed the lives of many South Africans.
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John and Mary’s Story John and Mary were drowning in debt with multiple credit cards, personal loans, and a car loan. Their monthly payments were unmanageable, and they were constantly harassed by creditors. After entering debt review, their counsellor negotiated reduced interest rates and consolidated their debts into a single, affordable monthly payment. Within three years, they were debt-free and had learned valuable budgeting skills.
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Thabo’s Journey Thabo, a single father, found himself struggling with high-interest payday loans. The stress of managing his finances was affecting his health and family life. Through debt review, Thabo’s counsellor managed to negotiate better terms with his creditors, significantly lowering his monthly repayments. Today, Thabo is debt-free and has built a small emergency savings fund.
What are the effects of being in debt review?
A chance at getting out of debt and improving your credit score because you have consistently shown that you can pay your debts on time!
How long does debt review stay on your name?
The amount of time debt review stays on your name differs from person-to-person. This is dependent on the amount of debt you have and how much you are able to pay towards it each month.
It's important to note, however, that debt review is not a criminal record or life sentence. Once you have successfully completed the debt review process, the debt review flag will be removed from your credit report and you will not only be able to start applying for credit again, but you'll probably be in a better position to do so.
Take the First Step Towards Financial Freedom
Don't let debt control your life. Take action today and start your journey to financial freedom with Meerkat's debt review services. It's time to reclaim your peace of mind and secure a brighter financial future.
Ready to get started? Contact us now and let Meerkat help you conquer your debt. Fill out our quick and easy form, and one of our expert consultants will get in touch with you to discuss your options.
