National Debt Advisors

National Debt Advisors – what you should know

No one can deny it; South Africa is experiencing such economic strife. The cost of living is fast becoming an ever growing burden with the price of food and petrol escalating frequently not to mention electricity and water which are a definite “Can’t go without” and the interest rates are always a frightening bewilderment. The current state of things in South Africa is leaving many with the desperate need to take out loans even though they may be under debt review. Should you find yourself in the position where you are seeking a loan whilst you are under debt review South Africa; you might want to consider other options first.

In accordance with the National Credit Act (NCA) should you be undergoing debt review; you are forbidden from taking out any additional loans. Should you be given a loan by a money lender whilst still under the debt review procedure it would be the prevalence of reckless lending. The credit lender should ensure that the person or party taking out a loan has undergone and passed the affordability assessment before taking out a loan, this is to ensure that the party taking out the loan qualifies to take out the loan and can pay it back within the stipulated time frame.

When and if the credit provider does not conduct the affordability assessment with the borrower and goes ahead to grant them a loan, it is considered reckless lending and should the borrower not understand or grasp the credit risks and enters the agreement with the lender, this too is recognized as reckless lending and lastly if a consumer becomes too indebted from taking out money from the lender this too is also known as reckless lending.

People who are going through the process of debt counselling are already financially over obligated and as a result it has become impossible for them to repay all their debts accordingly and on time. Debt counselling is like taking your finances to rehab and in rehab we do not indulge and add on to our bad habits; instead we clean them out; just as it is with our ever so strained finances. In 2007 the NCA launched Debt Review as a means to legally alleviate debt from consumers. This was done to assist consumers that were over indebted and were unable to afford the payment of their accumulated debt on their car finance, mortgage bonds, and credit and retail accounts. This was implemented in order to avoid the consumer from being blacklisted or have to go through default judgements, repossession and garnishee orders.

The purpose of debt review is to ensure that the consumer is able to settle his/her debts by becoming free of debt and being able to once again participate in the credit market, ever so cautiously of course. Taking out loans can be a cause for concern because the more loans one has the more payments they have to make and for a person who is already stressed by debt; taking out a loan is not the wisest of choices. The only people who will offer you loans while still under the process of debt review are unethical loan sharks. You stand a high risk of losing your car, home and even a large portion of your salary should you keep taking out numerous loans. It goes without saying; do not take out any loans whilst still in debt Review South Africa.

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