How to get out of debt? If you’re too scared to open your mail or answer your phone because the debt collectors are hounding you, then this article is for YOU
Financial security is something that every South African hopes to achieve. However, according to a report by MoneyWeb, “The country has 25m active credit consumers – and more than 10m are behind on their payments.”
The coronavirus pandemic has also wreaked havoc on South African businesses, leading to a high number of retrenchments over the lockdown period. According to a May report by Statistics South Africa, 8,1% of respondents reported that they lost their jobs or had to close their businesses and 1,4% became unemployed.
But there is HOPE.
Despite the mountain of bills, being black-listed or even having court judgements against your name, you CAN get out of debt and become financially free again.
All4Women spoke to Credit Clear, and followed the journey of Mrs. B* who was able to clear thousands of rand in debt in just two years.
Mrs B’s success story:
When Mrs. B first joined us, she was overwhelmed with debt, a poor credit rating and a Debt Review listing against her name.
She felt helpless and saw a bleak financial future with no prospect of climbing out of the abyss and ever being able to obtain credit again. Mrs. B was despondent and was apprehensive that Credit Clear would be able to help her out of her situation but, with the right plan and guidance from us, it took less than two years to clear Mrs. B’s name at the Credit Bureaus with all her debt either written off or paid, and the debt review successfully being withdrawn and removed against her.
It’s never “too late”
Mrs. B’s initial assessment did in fact appear somewhat bleak as she had 10 judgments against her name as well as various defaults and poor payment profiles and of course the Debt Review listing against her name.
The judgments included five judgments from African Bank and others from Numix, Bridge Finance, Pathcare, MBD and Bayport. Defaults and poor payment profiles included Rage, Foschini, Nedcard and Bayport.
Mrs. B had previously incurred a lot of credit, however, this eventually caught up with her and she elected to go under Debt Review in an attempt to settle her creditors.
It’s a long process, but worth it in the end
The Debt Review, however, was not the solution that Mrs. B had in mind as she realised it was going to take her quite some time to settle her debts and she would be financially constrained for a long time.
We immediately assessed Mrs. B’s profile and came up with a plan of how she could settle her debt and have the Debt Review removed as expeditiously as possible.
“We were able to negotiate reduced settlement discounts which Mrs. B was in a position to pay over a short period of time.”
The outcome was as follows:
- On contacting the Debt Counsellor, we ascertained that Mrs. B had informed the Debt Counsellor of her intention not to proceed with the Debt Review prior to it being made an Order of Court. Therefore, no payments were made to the Creditors, however, as she initially had an intention to follow the Debt Review route, the Debt Review indicator would remain on her name until such time as all Creditors had been paid.
- We then looked at how we could assist Mrs. B to finalise the accounts as expeditiously as possible so that her name could be cleared. The first thing we did was ascertain whether all her accounts met all legal requirements with regard to interest, prescription, etc. Once we had sorted the accounts according to disputes, we commenced settlement negotiations with her creditors. On the smaller accounts such as Pathcare, Numix, Bridge Finance and MBD, we were able to negotiate reduced settlement discounts which Mrs. B was in a position to pay over a short period of time. With the larger accounts such as African Bank and Bayport, we negotiated monthly instalments and as Mrs. B collated funds during the payment period, we negotiated further discounted settlements as and when she was in a position to settle each account until such time as all the accounts were paid.
Once all the accounts were paid, we obtained the necessary paid up letters and we attended to the removal of the listings at the Credit Bureaus as well as forwarded them to the Debt Counsellor who then duly provided us with the Clearance Certificate which was forwarded to the NCR and the Credit Bureaus and the Debt Review was successfully removed.
- On assessing the matters, we also noted that the following matters had prescribed (as they were older than 3 years and had not been paid in excess of the 3-year period and no claim had been made against Mrs. B by any of these creditors during this time). As such, these accounts were successfully written off and closed:
We had an amount in excess of R8 000 00 written off and Mrs. B did not have to pay these accounts as we successfully assessed and applied the law of prescription.
As a result of our assistance and Mrs. B taking the decision to work hand in hand with us and following our plan and advices, she became financially free and contacted us subsequent to us providing her with her fresh Credit Records confirming that her name had been successfully cleared to advise us that she had successfully applied for a loan with a major bank and she had been approved for motor vehicle finance.
Mrs. B was enthralled with our services as she thought she had reached the end of her financial future, however, was now reaping the benefits of being financially free.
*Mrs. B has not been named in order to protect her identity.