Exclusive Insight to the cost involved of your Debt Review profile
In this week’s blog, we at Consumer Debt Support (CDS) would like to share our annalistic costing structure with our readers, for a better understanding of how the costings in the Debt Counselling industry work. We find it daily that clients are uninformed what their debt counselling companies charge them. Every person thinking of going into debt review must know what they can expect when they apply for it. Consumer Debt Support http://www.debtcentre.co.za/contact-us/ is affiliated with DEBT EEZY http://www.debteezy.co.za call centre (a very reputable debt counselling company), our operators are managed by registered debt counselors who is on the floor at all times to assist consumers and verify client’s over-indebtedness. We ensure our clients are receiving only the very best service and peace of mind when entering the debt review or Voluntary Restructuring program.
How to get your Peace of Mind
- Ask somebody who had experience with a Debt Councillor and Debt Review for a good referral if possible, if not, contact CDS we are a nationally debt counselling company.
- Take down the name, surname and contact details of the person you spoke with on the phone.
- Ask for the NCRDC number of the debt counsellor! They must be registered by law.
- Google search the NCR database of S.A under “registered registrants” and check whether the person you want to entrust your debt, home loan or car payments with, is registered with the NCR (National Credit Regulator), if the registration is valid, it will be marked by date.
- The Debt Counselling company should have their own website, with all their credentials available for you to follow up on.
- Debt counsellors should not use Gmail accounts, they should have something like email@example.com on www.debtcentre.co.za for an example.
- Get more information! There is an online monthly and once yearly print special edition DEBT FREE Magazine on Debt Counselling where you can find the much needed answers to your questions with references to registered debt counsellors you can contact. www.debtfreedigi.co.za
Know this! No upfront money on application! RED FLAGS!
You should not be asked to pay R3000 or any amount upfront before you speak to a debt counsellor. If this happens to you report it to the NCR immediately.
The number you need to contact the National Credit Regulator is 0860 627 627.
Deal only with NCR registered debt counsellors always look out for the NCRDC number.
What is an assessment of a Debt Review application?
It does sound a lot like an administration or a legal thing that will affect one’s credit report and job seeking. No, it’s to determine if you are over-indebted with all your monthly obligated debt payments. “It’s a Review of your financial situation, an assessment to propose a more affordable payment plan on your monthly debt, this takes into account your living expenses to support your family’s day to day needs and salary deduction before take home pay.” If it so happens that the Debt Councillor’s findings are that you are over-indebted, or if some of your debt is Recklessly approved also known as Reckless Lending, it will be forwarded to your creditors, to ensure they participate in the investigation to determine the findings and whether the debt counsellor has grounds to proceed.
What does the National Credit Regulator (NCR) do?
The NCR is a legal entity by court of justice and has a duty to ensure they regulate and monitor all debt counselling offices. Their task is to enforce the relevant Legal ACTS, to check all approved applications for the correct procedures, check up on paid fees to the Payment Distributing Agent (PDA), the Attorneys and the Debt Counsellor and to oversee all matters referred to a Magistrates court or the National Consumer Tribunal (NCT).
The PDA is approved, regulated and registered by the NCR. Consumers pay their moneys to the PDA who ensures it is distributed. Your debt counsellor will explain this during the assessment.
The PDA sends out statements to the consumers showing how their money was paid out every month. This is your money and your debt, ensure you receive your statements, if not inform your debt counsellor of the problem.
The cost of the Debt Review assessment is Once off – R 350.00
This fee is charged after the assessment is concluded, whether the consumer is over-indebted or not. At CDS it will be added it to the first fee payable if the consumer enters the program on the next date of the salary. We understand that our clients are struggling financially and most likely do not have R350.00 on the day of the consultation.
What is the R350.00 for?
R50.00 is a compulsory charge for the application pack that is sent to you to complete.
R300.00 is a compulsory consultation fee the debt counsellor, his/her agent spends with you during the assessment.
What is the cost of a debt review court application?
A debt review application has a regulated fee composition set by the National Credit Regulator (NCR). The analysis of the fees can be disclosed once the client’s application assessment was successful, and the restructured payment amounts was accepted by the NCR and the creditors. For the purpose of this quoted examples; The debt counsellor has now found you to be over-indebted and find that you qualify for the debt counselling program. Demonstrated in the following fictional examples…
Example One:Your debt is currently R12000.00 per month, your debt counsellor restructured the debt to R6800.00 for you to pay every month. ***** This debt counsellors fee is once off R6800.00 *****
Example Two:Your current debt exposure is R4500.00 per month. Your debt counsellor can restructure the debt to R1900.00 for you to pay every month.
***** The debt counsellors fee is once off R1900.00 *****
Example Three:Your current debt exposure is R33000.00 per month. Your debt counsellor can restructure the debt to R21000.00 for you to pay every month.
***** The debt counsellors fee is once off R9000.00 joint estate application***** Single application is R8000.00
The Debt Counsellor may charge NOT more than R300.00 for the cancellation of the debt counselling where applicable not exceeding Five days after the application.
Yes, there are Legal Fees. All attorneys dealing with debt counselors should have service agreements in place in what they charge, this should be discussed with you during the assessment.
What is the cost if there’s Reckless Lending allegations against a creditor? Reckless lending allegations must be investigated by the debt counsellor and the cost is R1500.00. Only a registered debt counsellor can refer the matter to court.
All stakeholders in the industry (NCR, creditors, DCASA, PDA’s and registered debt counsellors) agreed that the first 60 business days the debt counsellors fees and legal fees for the debt review be paid. When the creditors issue the Certificate of Balances to the debt counsellor dealing with the application, the balances include the 60 business days payments that was paid by the consumer towards the fees of the debt counselling program.
CDS is proud of the level of trust and open relations we have with our clients who benefit from the Debt Review Program. Knowledge of the costs explained are the key factors we focus on in this educational drive. Consumers should have insight and understanding of what can be expected when finding themselves in a difficult situation and can no longer pay their creditors on time due difficult financial challenges facing the individual and family. It is your money and your debt, therefor it is your right as consumer to ask questions and familiarise yourself with what can be expected. The debt counselling industry is regulated and therefore debt counsellors may not charge what they deem is fair for the application of an over-indebted consumer into debt review.
A note for the Author Annienne Nel
I hope this blog sheds a little light on the fees involved in a Debt Review Case, and now consumers know what to expect when they call our offices for assistance. I believe in fair conduct and justice to ensure just cause for consumers caught up in Recklessly granted credit which they could not afford in the first place. CDS is the voice for consumers, struggling to cope with debt that has crippled the basic rights of food on the table for their families. Treat others how you want to be treated is the punch of my business and dignity is a right for everyone. I wish you all the best in your work and God’s blessings for your families.