The debt counselling process is easy to apply for and fairly straight forward. A professional consultant will evaluate your income and your debt. They will then assist you to devise a payment plan that will help to repay all the money you owe and clear your name. This will allow you to regain your life and manage your future debt more responsible.
Importance of immediate application
In the current economy, people tend to spend more and more, while the cost of living increases. This spending might work at first but soon you will find yourself with a lot of debt. This can result from credit card charges, car and house loans, and even general living costs. This becomes a serious problem when you no longer can pay back the high rates on the money you owe and still maintain your lifestyle on the salary you earn. If you cannot repay creditors, this will have very negative effect on your credit score. If you do not apply for help immediately, you will be charged with a summons and be face with being blacklisted, your assets repossessed, face foreclosure and even bankruptcy. It is important to apply for debt counselling as soon as possible so that a consultant can help you with your debt and negotiate repayment rates with creditors.
The process after application
The debt counselling process is easy to apply for. It is important that you fill out the application form properly and provide all the correct details. This will make sure that the counselling consultant has all the information they need to help you with your current credit problems. They will act as a mediator between you and the creditors. The consultant will fully explain the counselling process to you and the fees involved while they review your application and evaluate your current financial situation. Once you understand and are satisfied, they will start the process of negotiating a payment plan based on the income that you earn. By contacting the creditors and reaching an agreement with them to lower their interest rates, the consultant will adjust the payments you need to make monthly.
The payment plan that will be negotiated will be based on your monthly income, and the consultant will negotiate with creditors to allow you to realistically be able to pay back the money you owe, and still have money to pay your everyday living costs. From start to finish, this process usually takes about sixty days. It is important to remember that while your consultant is negotiation with the creditors, that you do not create new debt for yourself. This will negatively affect the outcome of the negotiations and will diminish your ability to live on your income and pay back the money that you owe.
The form for the debt counselling process that you will need to complete is called a Form 16. You will need to correctly fill this out and make sure that when you hand it over to the consultant that is helping you, that all the relevant information and supporting documents are included. This is to make sure that the process will be handled quickly and accurately. If you are unsure of what to include, your consultant will inform you on all the information that needs to be provided. They will also check that all the information is correct before taking the next step and contacting the creditors. This will usually be within five days of you handing over your completed and signed application form for debt counselling. Once the creditors have been notified that you have applied for this service, they will no longer be able to take out legal action against you.
After they are informed, the creditors have five working days to confirm your account details and contact the counselling consultant. If they have not replied to the consultant, they will be reminded and are given a further five days. If after ten days, they have not made contact, then the consultant will presume that all the information provided by you is correct. They will now evaluate your debt and start to prepare a payment plan and proposal to present to the creditors. This proposal will be sent out to the respective creditors within twenty-five days from when you handed over you debt counselling application to the debt consultant. After this, the creditors have ten days to respond to the presented proposal. If they do not respond, they will then be given a further five days to reply.
If the creditors do not respond or do not agree with the proposal, the case will be handled by the Magistrate’s Court and finalized. Once an agreement is reached and the proposal is settled, it will be sent to the Payment Distribution Agency (PDA). You will now no longer pay each of the creditors individually, but pay one fee to the PDA, who will distribute it to them. You will continue to make payments in accordance to the finalised agreement until you debt is repaid. You will then be issued with clearance certificate and declared debt free.
Manage your debt responsibly
Once you find yourself falling into debt, it is important to immediately apply for a debt counselling process before legal action is taken by creditors. This will protect your assets, and a professional consultant will help you plan a realistic payment proposal based on your income. They will help you manage your debt responsible and clear your name, allowing you to regain your life.
Act now, apply for the debt counselling to clear you name and regain your life. Contact us today.