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Debt Review Removal

Debt Review Removal

Debt Review Removal in South Africa: Is It Legal?

The feeling of your finances shackled by a poor credit score, or crippled by debt, is one of the most defeating emotions. It's a situation that feels bleaker than words can describe, like a weight you'll never shed. The pandemic has left millions of people in financial ruin.

Are you living in South Africa and suffering from this issue, or are you on the road to recovery? Then there might be legal recourse for you to follow for debt review removal.

Courtesy of the credit experts here, we can go through the facts. Read on to find out about the legal status of debt review. We'll soon find out if there's any light at the end of that financial tunnel.

What is Debt Review in South Africa?

When under extreme financial duress, it's no surprise if events go by too fast to take your time making decisions. Depending on how compromising the situation was, the only available option at the time may have been a debt review.

Debt review has its advantages, like not ending up on a blacklist. You also receive assistance in managing your debt, which can be an enormous relief.

Entering into a debt review or debt counseling is legal, becoming law in 2007. It's been a boon for some people who would have found no other way out of debt.

What was once much-needed assistance can become unnecessary as your circumstances change. People who have managed to get back on their feet may be questioning whether they need to be under debt review.

You could always wait out the debt review or pay off the debt faster, but this may be inconvenient. You might be in a stable financial position and need to take out more credit. Due to debt review, you'll have your hands tied.

Debt review removal. How to Cancel Debt Review in South Africa?

Debt review itself may be a well-established practice but removing yourself from the process is a different story. It's not as simple as ditching your financial assistance or unsubscribing from a service. It's a complicated legal process.

With that said, a point to focus on is that it is a legal process. It's also a complicated one and will involve contacting a registered debt counselor and appearing before a magistrate to appeal for the review listing removal. It's a lot of documentation to get in order and potential expenses. Your best bet would be to contact a qualified debt counseling service to discuss your options. The National Credit Act introduced debt review as a debt relief option for overindebted consumers. Debt counsellors are the only ones who can conduct this statutory process.  

Getting rid of a debt review indicator is becoming increasingly difficult lately. There is an additional step that you need to take to complete your debt review process or even cancel it early, and unfortunately, it is not something that you will be able to do on your own. In this case, an attorney will be necessary. Fortunately, we can help. 

To terminate the debt review process and to have the debt review indicator removed from your credit reports requires that a court application is made in court. It will be necessary for the courts to determine that you are not over-indebted. If there is no court order for your debt review, you still need to go through this process.

Debt review indicators: what do they mean? 

When you have been approved under the debt review process and/or have been deemed overindebted, your debt counsellor will contact all the credit bureaus in South Africa to notify them of your application. While you are undergoing the debt review process, your profile will reflect as currently under debt review, which prevents you from taking on any further debt. 

The debt review indicator and debt review flag help you stay on top of your finances and assist credit providers in identifying overindebted consumers. Keeping on making more debt would make getting out of debt extremely difficult. Due to this, you should avoid debt while you are under debt review. This article discusses when and how debt review indicators can get removed.

First step: Check if your name is under debt review?

Examining your credit report will reveal whether your name is under review. You can obtain your credit report from any major credit bureaus, such as Experian, TransUnion, Compuscan, and XDS can provide you with your credit report. An under-debt review notification will appear on your credit report. We have an online credit bureau report requesting a service which provides you with a comprehensive credit report from all four bureaus in one easy step. Click here to request our comprehensive 4in1 credit report. 

Debt Review Removal with no granted court order

You can end the debt review process and remove the debt review indicator if your financial situation is stable to the point where you can repay all your outstanding minimum payments. Considering that you are no longer over-indebted and would be able to repay your accounts directly and not need help from a debt counsellor, listing you as under debt review would be unfair and counterproductive. 

To complete the debt review removal procedure, you must obtain a court order to be declared no longer over-indebted. Once the court grants the order, the credit bureaus will get a notification that the court order has been successful and that you are no longer over-indebted. The bureaus will remove the debt review indicator from your credit report. 

Debt review removal Timeframe - All debt paid in full

The debt review flag will appear on your credit profile with all bureaus until you have paid off the entirety of your debts and are current with your bond payments.

After settling all your creditors, your debt counsellor will issue you a clearance certificate indicating your debt review completion. After receiving notification from the National Credit Regulator, your name will get cleared from the credit bureaus within seven days. The sooner you pay off every one of your debts, the sooner the debt review indicator will get deleted from your name. 

Debt Review removal process. Debt is still outstanding.

The court ruled in Rougier v Nedbank that any conduct by a debt counsellor that will result in the termination or withdrawal of debt review will act outside the statutory powers conferred by the Act on debt counsellors and is therefore prohibited. 

This court decision led to the issuance of the National Credit Regulators' withdrawal from debt review guidelines and the introduction of form 17. W. Removal of the debt review indicator is only allowed in the following situations:

  1. You opted out of the debt review process before your debt counsellor issued Form 17.2 to creditors. 
  2. You obtained a court order declaring that you are no longer over-indebted. 

Only the above two situations would result in the removal of the debt review indicator. When your debt counsellor issues form 17.2, you will still need a court order to declare that you are not over-indebted before the debt review indicator gets removed. 

Debt counselling cancellation through the courts

 A consumer can apply to a court to get declared not overindebted. It is best to speak to an attorney about the formalities of making an application since errors can lead to the application failing or postponements that could get avoided. 

As such, a consumer can employ the services of an attorney to attend to the court application to terminate the debt review process. You need not be present at court if you use the services of an attorney to apply for the termination of debt review. The attorney will still need your assistance, typically in the form of providing documents and information as required. Once the court application has taken effect, the consumers' credit report will get updated with the various credit bureaus. This court order will remove the debt review indicator. 

Debt Review Removal or Stable Payments

Remember that debt review removal isn't always the best option. Keeping yourself as far away from endangering your credit score is always a safe bet and is even more true if you've already had financial issues.

By consulting an expert, you paint a clear picture of the best choice

If it's a qualified professional you're looking for to answer any more of your questions, we're happy to field your concerns at Credit Salvage. It's easy to contact us, and with just a single click you can find out about the best strategy to handle your debt.

So, apply for our credit clearance application to start getting out of debt today or to apply for our debt review removal program.

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 credit clearance header

Credit bureau Clearance an Introductory Guide

Credit Bureau Clearance! An Introductory Guide to ITC Clearance.

 

The average South African household has debts that total almost 68 per cent of their disposable income. Are you one of the many struggling with debt management? Do you fear being blacklisted from the credit bureaus? Are you looking for credit bureau clearance in South Africa?

Trying to rent a house and applying for a job are just two of the ways your credit report influences your daily life. Credit bureau clearance helps to restore your bureau record. Learn more about how to take control of your bureau profile with credit bureau clearance.

Checking Your Credit Record

Before you can clear your name from a credit bureau in South Africa, you need to know where the problems are. You have the right to get a free bureau report once a year.

Credit Bureaus in South Africa

You'll need to get a report from each bureau. Different bureaus may hold differing information about you.

South Africa has eleven registered bureaus. The four major ones are:

  • Experian
  • TransUnion
  • Compuscan
  • Xpert Decision System (XDS)

TransUnion was formerly known as ITC. For many years, it was the only bureau in South Africa. That's why many people refer to credit bureau clearance as ITC clearance.

How To Get Your Credit Report

You have probably already obtained a copy of your credit report from Compuscan, Experian, XDS, Vericred and TransUnion. By law, you have the right to one free report per year from each bureau under the National Credit act 34 of 2005.

After providing some personal information and answering a few security questions, you'll be able to download your free financial standing report after accessing the credit bureau's website. You can access the credit bureaus online applications below:

It is also possible to request a hard copy of your report to be mailed and emailed for you if you prefer. Your record is private and confidential, and You will need a valid South African ID number to access your report. Additionally, we offer a four-in-one credit report. Get your copy of all your credit bureau reports by contacting us today. 

Dispute Incorrect Information on Your Credit Record

It is essential to verify the accuracy of your financial standing reports once you have received them. Due to the fact that some creditors and banks only report to two or three credit bureaus, your credit reports won't always be the same.

If all five bureaus receive your payment profile history from these creditors, one may inadvertently make a mistake when entering this vital payment behaviour history. Therefore, you should examine all five bureaus very closely with a magnifying glass, rather than assuming the information is the same on all five. You can dispute inaccurate information in your reports if you believe it is incorrect. 

You'll need to dispute inaccurate information with each bureau individually. Each bureau has its dispute process. You can find out how to file a dispute on the bureau's website or by calling the company. If there are errors or judgments, we offer an easy solution to rectify them. Fill out our simple online application form, and we will start the process as soon as possible. Credit Bureau Clearance

Types Of Credit Bureau Listings

Your credit report may show several types of adverse listings. These listings correspond to different kinds of debt problems. Common types of listings include:

  • Default
  • Judgments
  • Administration orders
  • Debt review
  • Adverse payment profile histories
  • Sequestration and rehabilitation orders

Adverse listings stay on your record for between 1 and 10 years, and it depends on the type of listing.

Default (Adverse) Listings

The two types of default listings are:

  • The first is adverse classifications of consumer behaviour.
  • The second is damaging classifications of enforcement action.

Consumer behaviour refers to problems like consistently overdue payments, delinquent payments, or not replying to correspondence from creditors. Enforcement actions include handing a debt over to a collection agency, repossession, or repossessions of houses and cars.

Adverse listings stay on your record for a year or until you fully pay the debt.

Credit Bureau Clearance. An Introductory Guide Infographics

Judgment Listing

A civil court of law may grant a judgment to a creditor or service provider against a consumer who didn't pay their debts. The default judgment is an attempt to force you to pay.

Generally, creditors apply for judgments when consumers have fallen behind on their payments and have neglected to respond to demand letters in accordance with section 129 of the National Credit Act 34 of 2005. Creditors also go this aggressive route if a consumer has made a payment arrangement, signed an acknowledgement of debt, and has failed to honor this payment arrangement. A judgment can be granted in your absence if you don't take action to defend the summons or make payment arrangements with the creditor. 

A judgment stays on your record for five years. It can come off your record sooner if you fully pay the debt or the court rescinds the default judgment.

Administration Order

An administration order is an application you can make yourself. It can help you avoid legal action from creditors.

A magistrate evaluates your financial position and appoints an administrator to whom you must make regular payments. The administrator divides your repayments proportionally among your creditors.

Consumers who use the administration process will reduce their monthly payments. Unlike debt review, creditors only receive debt repayments every three months under debt administration. You can extend the debt repayment terms through this legal process, but it is lengthy and takes considerably longer than debt review.

An administration order stays on your personal profile for five years or until the court rescinds it.

Debt Review

Debt Review is another application you can make yourself. It helps you if you can't afford to pay your creditors and wish to avoid legal action. A Debt Counselor negotiates new payment arrangements with your creditors.

Debt review stays on your report until you receive a clearance certificate. You can get a clearance certificate by:

  • Satisfying all your payment obligations under the debt review arrangement order, or
  • Demonstrating your financial ability to meet your future obligations

When you have a long-term agreement like a mortgage, you must show you've met your current obligations and have the means to continue to make payments.

Payment profile

Your credit score is heavily influenced by how promptly you pay your monthly accounts. A whopping 35% of your score depends on your payment history! Your reports will list this history through the different accounts you have had in the past five years.

It is possible to see how much you have paid each month under each loan, motor finance account, payday loans, and home loans that you had.

In the case of late payments, the account will get marked with the exact period it was late. This indication will range from 30 days to 150 days. The longer you wait between payments, the lower your score becomes. 

Sequestration and Rehabilitation Orders

You can apply to the court to issue a sequestration order that declares you insolvent. The court then appoints a trustee to sell your possessions and other assets.

You must pay whatever debt obligations remain after selling your assets. These can be in the form of a payment plan.

Sequestration orders stay on your personal profile record for five years unless the court issues a rehabilitation order.

You can successfully apply for a rehabilitation court order when you're able to prove that you're capable of managing your finances. You can also get a rehabilitation order if:

  • Selling your assets makes enough money to pay off all your creditors, or
  • Ten years have passed since the date of sequestration, or
  • Six months have passed since the date of the sequestration order, and no creditors have valid claims

A rehabilitation order stays on your personal profile record for five years.

Getting a Credit Bureau Clearance

Clearing the listings on your credit record as soon as possible is especially important. The fastest way to remove most unwanted listings is by paying your debts in full.

This solution might not always be as simple as it sounds, though. Some other methods are available to get credit bureau clearance.

Credit Salvage Credit clearance online application

Why is it so hard to do credit bureau clearance?

Anyone who has attempted a credit bureau clearance has probably experienced considerable frustration while clearing errors on their bureaus report. 

Imagine a scenario in which a creditor incorrectly reported your overdue payment. As a result, your score plummeted, and you decide to dispute it with the bureaus. After wasting hours trying to contact a consultant, you finally reach one, and you manage to log your dispute. You provide proof that you made payments, and a challenge gets logged. Now you have four or more bureaus to deal with to do the same process all over again. 

Credit bureaus contact the creditor who reported the information. After the lender examines its records, it sends the same data back to the bureau. Credit bureaus inform you that the lender has verified that the information about your account conduct is accurate. If the process is not done correctly from the beginning, it can take months or even years to get resolved.

Despite your tenacious efforts to remove the adverse information, the routine monthly updates the creditors send to the credit bureau's database are likely to restore the error you worked so hard to get fixed.Then you have to complain to the various bureaus several times, which is very aggravating.

According to the lender, you should contact the bureaus. Credit bureaus claim it's often the creditors' fault, claiming they are just the receivers of incorrect information, which should not excuse them.

Violations of the National Credit Act

You could get default listings removed if the lender violated your rights under the National Credit Act when they filed the default with the various bureaus. For example, creditors must give you written notice of their intention to list your delinquency and adverse account with the credit bureaus.

If your creditor doesn't respect your legal rights, you can dispute the listing with the credit bureaus.

Court Rescission

You may not be able to remove listings resulting from court orders from your credit report if they are unpaid. You have to apply to the court to rescind the order. The conditions for rescission depend on the type of court order.

The process of having the court rescind an order is straightforward. However, you must adhere strictly to the application procedures. The easiest way to remove judgment information is to settle the account. Registered lenders will entertain settlement negotiations to get the debt paid. As a result of the settlement, the judgment information will get removed, and there will be no need to approach the courts for rescinding the judgment. 

Results and an increase in credit scores will not happen overnight!

If you have negative information on your credit reports, such as judgments, defaults, debt review indicators, and administration orders, you can get them removed quickly from your personal profile report. However, it will take some time to rebuild poor credit history and increase credit scores. 

Your credit score is more affected by items recently added to your credit history than those from earlier in the history of your personal profile. In general, a good financial standing history will have few negative entries and plenty of recent positive information.

It takes a few months of on-time payments to build your score, but please don't expect it to happen immediately. You'll see your reports improve over time as you replace negative information with positive information, as the negative information falls off or gets older.

Get Help with Your ITC Clearance

Getting credit bureau clearance is extremely important, but it can seem overwhelming. You will need detailed documentation and an understanding of many rules and regulations. You don't have to go through the process alone, though.

Credit Salvage Debt Counselling Services has helped thousands of clients improve their credit records. We'll analyze your profile and work with you to create an action plan. We'll ensure that the information in your report is accurate and up to date, including removing adverse accounts that you've already paid.

Contact us today to schedule a consultation and start enjoying the peace of mind you'll get from better records.

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Blacklisted! Clear Your Name

Blacklisted? Clear Your Name! How-To Guide in South Africa

Did you know that despite rising interest rates and poor economic conditions South Africans are coping with their debt? Unfortunately, not everyone is lucky enough to stay on top of their debt.

If you fall into debt, you can get blacklisted. So, what should you do if you’re blacklisted? Clear your name! In this article, we’ll walk you through everything you can do to get your name unflagged. Let’s get started!

Why Do You Get Blacklisted in South Africa?

When you can’t pay the debts on your loan's repossession isn’t the only thing that will happen to you. It can also have long-term consequences on your credit.

When you don’t pay your debts, your lender will label you as a defaulter. From there, your name will be flagged on the credit bureau. So, whenever you try to take out new credit the lender will see that you’ve been a bad payer in the past.

It’s called blacklisting because it blocks you from getting credit almost everywhere until you get it taken care of.

Make Sure You Check Your Credit Report

As a South African citizen, you’re allowed to access your credit report once per year for free. If you’ve been blacklisted, you must do this right away.

It will allow you to see which debts on your profile are causing you to be flagged. Once you learn what they are, you can begin to clear your name from a blacklist.

What If You Were Blacklisted by Mistake?

If you checked your credit score, and know you made payments on time, then there could have been a mistake when getting blacklisted.

When this happens, you can file a complaint with the NCR, or National Credit Regulator. They’ll work with you to reverse the mistake.

Clear Yourself by Going into Debt Counseling

Odds are if you’re deep in debt, you don’t have enough money to balance your expenses with your payments. If you fall into this category, it’s time to contact a debt counseling professional.

They can help you learn how to clear your name from being blacklisted. This is a legal operation in which a counselor negotiates with your creditors on your behalf.

Your counselor works on your behalf to reduce your interest rates, extend your credit agreement, and have the installments themselves lowered. Just make sure you’re going with credible company.

There are a lot of unreliable operations that take advantage of people in a tough position.

Were You Blacklisted? Clear Your Name with Credit Salvage

We hope this article helped you answer the question, what do I do if I’m blacklisted? Clear your name as fast as you can if this happens to you. The longer you’re blacklisted, the harder it will be to get out of debt.

If you’re ready to get rid of your debt, then get in touch with Credit Salvage. We work with people who are serious about clearing their debt by vouching you to prospective credit providers.

So, apply for our credit clearance application to start getting out of debt today.

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Credit vs debit

Credit vs Debit card

Credit vs Debit: What is the Real Difference?

If you want to improve your finances, you should understand the differences between credit vs debit. Here's what you need to know.

According to BusinessTech, credit card issuers may have reduced new card originations last year, but outstanding credit card balances climbed.

While some people have no choice but to use credit for purchases right now, others could avoid further debt if they would use a debit card as much as possible.

So, what exactly is the difference between the two types of cards? Here is what consumers need to know about credit vs debit.

Credit vs Debit Basics

There is a reasonable chance you might have both a debit card and a credit card. Debit cards and credit cards look the same and have the same purpose. However, there are several reasons why you should choose one over the other.

By using a debit card to make a purchase, you are transferring money from the bank account linked to your card. It is imperative to note that if you use a credit card to pay for a purchase, the company that issued you the credit card will pay. You can think of it as a loan you are getting from a credit card company. You do not actually make the payment for the purchase until you pay the credit card company for the purchase.

Pros and Cons of Credit Cards

Credit cards have a lot of benefits that debit cards lack. Some of the pros of credit cards include:

  • The potential to earn credit card rewards
  • Protection against fraud
  • The ability to build a credit history
  • The purchase of goods or services, even if money is not available  

As beneficial as credit cards can be, the credit card pros can easily outweigh the credit card cons.

First, many credit cards have an annual fee and late fees. You pay interest charges if you don't pay off your balance in full each month. Even if you carry over a low balance each month, interest adds up. The higher your credit card balance grows, the better your chance of getting into debt trouble.

People who end up with too much credit card debt can seek debt counselling through a debt management company for help.

Credit vs Debit Cards. The Credit Card

Pros and Cons of Debit Cards

While debit cards are much safer for your finances, if you're someone who rarely pays off their credit card balance in full, most debit cards do not offer near the benefits that credit cards do.

While a debit card does not have an annual fee and does provide fraud protection, most debit cards do not give rewards, and using a credit card will not help you build a credit history. Like credit cards, debit cards can have many fees associated with the card's linked bank account.

The biggest debit card con for some is that you must wait until you have cash in the bank to make a purchase. This can be hard if you're struggling financially.

Do You Need Debt Counselling?

When it comes to credit vs debit, credit cards may be more convenient, but debit cards will help keep you out of debt. Even if you're managing your credit card debt now, a change in your circumstances could leave you in debt trouble.

If you've gotten into debt trouble, debt review can help you get back in control of your finances. Contact us today to speak with a debt management professional about debt counselling application

Conclusion: The workings of a credit and debit card

Although it is possible to use both cards to buy things, they draw money from various sources and apply it to diverse types of purchases. Because of this, they can each get utilized in diverse ways.

Credit Card

  • Credit cards have credit limits. Credit limits establish the amount you are allowed to borrow from the bank. You will receive a credit limit based on your credit score and financial affordability.
  • When you use your credit card, the bank that issued you the credit card pays the merchant for the purchase.
  • When a credit card gets used for certain purchases, the consumer borrows money from the bank. The consumer then pays back some or all the borrowed money at the end of each month.
  • Even if you do not have any available cash in the bank, you can still use your credit card for purchases, provided it is within your available credit limit.
  • Credit cards have high-interest rates if the outstanding balance on the credit card does not get repaid in full. Making delinquent payments will also result in higher interest charges and penalties for your credit scores. 
  • Credit cards and how they affect credit scores. Making payments on time each month will help you improve your credit rating. In the same way, skipping any monthly repayment will result in your credit score getting knocked down. 

Debit Card

  • Debit cards do not have credit limits attached to them. The funds you use for any purchases you make with your debit card will be deducted directly from your savings or cheque account.
  • If you don't have any funds in your account, you will not be able to make purchases. Overdrawn accounts are subject to additional bank fees. If this happens, it will negatively impact your credit score with the bank. 
  • Debit cards do not attract any monthly interest charges or fees.
  • Debit cards and how they affect credit scores. Your credit history is not affected by debit cards or how you manage the account. Using debit cards excessively will not hurt credit scores.

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