Debt Counselling - The Rewarding Benefits of Debt Counselling
The Rewarding Benefits of Debt Counselling
Working with a debt counsellor may be a good idea if you are struggling with your accounts. Here are all the benefits of debt counselling.
Unfortunately, debt is part of life that most people find challenging to get past. Good debt helps you pay your way through tough times, while overdue debt can cripple your life.
But, with debt counselling, it's easier now than ever to pay off your debts through manageable monthly repayments.
You no longer must stress over increased interest on your loans. Instead, a debt counsellor can help you speak to your creditors to reach an amicable agreement.
Of course, you'll still have to repay all your financial obligations, but it'll be less burdensome and achievable with a debt management company.
Best of all, it's accessible to all debtors - small or large profiles. So don't get blacklisted; clear your name and all overdue credit agreements today with our debt review process.
Is debt review the right process for You?
Yes! Debt counselling is proper for you if you have a debt or debts you cannot repay on time. For example, before acquiring a loan, you first agree with your creditor about loan repayment installments and the period for repayment.
But then life changes, and you can find yourself in a tricky financial situation, disallowing you to adhere to your loan repayment.
When this happens, your creditor can blacklist you. The result means you won't be able to take out a loan with any other creditor, worsening your financial situation presently and in the future. But, with a reputable Debt Management Company like Credit Salvage Corporation, you will have an extended repayment period, reduced interest rates, and reduced installments.
As research has suggested, debt review is the cheapest and perfect way to pay up your accounts, maintain a good credit score, and focus on what matters most, your life. Regardless of what type of financial agreements you have, debt counselling is right for you. For example, if you have a home loan you can no longer afford for whatever reasons, a debt counsellor can intervene for better terms and assist you in avoiding repossession.
Seeking this service is the best alternative to forgoing your loans. As a result, you'll manage your finances better and lower risks like losing your home and car.
Debt Counselling Vs. Debt Consolidation
You may be wondering, aren't the two similar? No, they are not. Debt consolidation is having all your accounts stack into one and repaying them on a single term with a high-interest rate.
In other words, you don't pay your outstanding debts individually. Instead, you combine them and pay them as one debt.
The debt review process doesn't combine your loans. It, however, negotiates for better repayment schedules and interest rates so you can repay the total amount on time without any stress.
How It Works:
When in heavy debt, the risks of being at odds with creditors increase. Similarly, your chances of being blacklisted by the credit bureau increase, lowering your future financing options. Thus, if you realize you cannot continue to repay your accounts on time, it'd be best to get ahead of creditors and consult a debt counsellor even if your creditors have blacklisted you.
A debt counsellor can negotiate on your behalf to clear your name from all credit bureaus in South Africa.
So how does it work? There are three main ways.
Your debt review company will negotiate to have your repayment installments reduced.
Your advising debt review company will speak with your creditors to offer flexible repayment periods.
Your debt review counsel can negotiate for reduced interest rates.
With these three services, you'll be able to repay your outstanding accounts in no time. After your initial consultation, your debt counsellor will customize a process that best suits your financial situation. Then, they will approach your creditors and start the negotiation process. You will remain protected under the National Credit Act during this entire process.
Finally, once you pay off all your credit agreements and accounts, at this point, your debt counsellor will present your clearance certificate to the credit bureau for a credit bureau clearance.
It may not be a painless process to clear your name, but the peace of mind, a perfect credit report and good credit scores are all worth it.
The Advantages of Debt counselling / Debt review
The benefits of this especially important process outweigh other options. While relinquishing your collateral to the creditor may be a potential solution. That will leave you with even fewer resources to get back on your feet. Since every potential solution has its risks, debt review stands out as less risky. Plus, you'll fast-track your repayments and get a Credit bureau clearance certificate. Receiving a credit clearance certificate has numerous benefits.
So, below are the top benefits you should consider debt review.
You Avoid Legal Action
When you stop repaying your outstanding debt, your creditors will get restless and consider acting against you. The first and obvious action will be legal action to compel you to adhere to your credit repayment agreement.
Legal action against debtors is never a good thing as it comes with many downsides. For one, the court can blacklist you, ensuring you don't get any credit in the future until you clear your outstanding debts. Being blacklisted will lower your financial options when you need them the most. Additionally, legal proceedings are costly, meaning you too will have to pay for a lawyer. Again, you'll spend too much time fighting your creditors, only for the law to side with your creditors.
Fortunately, you can avoid this headache by getting a debt counsellor for immediate assistance. Since the law mandates debt counsellors to help those struggling with heavy debt, you can rest assured you'll receive help.
Besides, seeking help before your creditors take you to court is beneficial because it eliminates legal action costs, time, and stress.
It Protects Your Assets
Usually, when you can no longer repay your debt, creditors move to repossess your assets as repayment. You'll not only lose your assets but also your livelihood if your assets were your source of income.
Fighting in court without proper representation to exempt your assets from repossession can prove futile. For example, if your lawyer fails to convince the judge not to repossess your properties. You'll lose your assets, credit score, and relationship with your creditors.
Even more reason, you need a debt counsellor to protect your assets. Your debt counsellor will go to court and get a court order barring creditors from repossessing any of your valuables.
The program allows you flexible repayment terms without the risk of losing your hard-earned assets in the process.
Clear Your Name from the Credit Bureau.
Regardless of if you're over-indebted, if you fail to repay your loan on time, you can get blacklisted. So, you'll not apply for new loans, your credit score will diminish, and you'll have significant outstanding debt in your record.
All these will make it challenging for you to control your finances and be financially stable. But, with debt review removal, you'll find out if you're over-indebted and take the appropriate steps to correct it.
Bear in mind that while the credit bureau cannot blacklist you while in debt review, you'll still need to stick to the new repayment terms.
Proper Financial Management
Although debt counselling's primary purpose is to help you navigate your debts, it can also help educate you in financial management. Unfortunately, many people don't know how to manage their finances well, if at all, leading to financial troubles down the road. But you can easily avoid these troubles by consulting a debt counsellor about your current financial situation.
The debt advisor then goes ahead to review your finances, lifestyle, debts, and other critical factors to determine your situation. Next, they'll draw up a plan to control your finances better, avoid heavy debts and afford your lifestyle. You'll understand your financial situation and learn ways to improve it in the future. Also, you'll gain control of your life, making it less stressful for you and your family. For example, if you have kids in school, but your debts are holding you down. Consultation with a debt advisor can give you practical solutions.
They can offer debt removal services or provide tips to lower expenses so you can afford your kids' tuition. There's no limit to what debt consulting services can help you achieve with your finances.
Debt Consolidation
Another critical service of debt counselling is that it is like debt consolidation. As explained above, debt consolidation combines all your debts under one interest rate and a single repayment term. Restructuring your outstanding debts under debt review can stretch your finances to the point of you being able to afford living expenses and your debt obligations. Plus, it makes more financial sense to pay them together in one installment at reduced interest rates to avoid over repayment and extended repayment periods.
Another benefit of debt review debt consolidation is it expedites repayment. With reduced interest rates and a single repayment term, you can clear your debt and move on with life. You'll also maintain a good credit score by the end of your debt clearance.
The reason is that debt counselling removal works to customize your loan agreement to suit your current financial situation. Consequently, the credit bureau won't blacklist you, retaining your credit score status.
Furthermore, once you repay your loan, you'll receive an ITC clearance, clearing you of all outstanding debts.
But paying loans and debts outside debt review divides resources, prolonging the repayment duration, and increasing interests
Debt Management
Debt management is your steppingstone to financial freedom, especially if it's crippling your life and business. The biggest challenge most people face is debts, reducing them, managing them, and getting out of them. Debt counselling is an excellent solution to protect your assets from repossession, accruing more interests, and having huge debts.
A consultation with a debt review advisor is the first step to understanding your financial situation and how your debt can affect it. After our intensive financial consultation, your advisor will present recommendations that will enable you to pay off all your accounts and achieve financial stability.
The recommendations can range from.
- Debt Review assistance
- Settlement negotiations
- Blacklisting clearances
- Creditor negotiations
Many other recommendations exist, depending on your situation and your debt counsellor will advise you accordingly in terms you can understand. The bottom line is these recommendations seek to manage debt in the best way possible.
Thus, if prospective creditors have turned you down because of your unpaid accounts, debt counselling can help you repay your obligations and get the credit bureau clearance for future credit eligibility.
You'll Meet Your Financial Obligations.
Repaying your debts is one of the primary financial obligations you have. The rest include paying your monthly living expenses, paying for insurance, education tuition, and other unforeseen expenditures. You cannot forgo these expenses as they are part of adulting and living. So, what do you do?
Simple, get a debt counsellor to help you get out of debt and streamline your finances. You'll learn how to control your finances through sustainable methods. For example, they can recommend reducing your spending habits.
Or deciding for rentals instead of home loans and only using your credit cards for small expenses.
Besides, it would help if you had a clear understanding of your finances and areas to improve sustainability and meet your obligations.
Debt Counselling Removal
Another rewarding benefit of debt counselling is debt review removal. But, of course, once you pay up all your debts, you'll want to get out of the counselling program. The reason is that the program has served its purpose by helping you clear your debt and keep a good stand with creditors.
Since you cannot borrow money or buy a house or car when active in the debt counselling program, you're bound to only commit to your current creditors. In turn, this limits your financing options, preventing you from acquiring financial support for your business or emergencies.
Luckily, the National Credit Act allows debtors who have cleared all their accounts listed in the court order to withdraw from the counselling process.
A clearance certificate will lead to the delivery of a clean and blacklisted free credit report that will have excellent credit scores.
No Record of Debt counselling because of your newly acquired credit clearance certificate.
Imagine if there was a record of your debt review process to all prospective new creditors. But, of course, this would mean creditors are shunning away from lending your money for fear of restructuring their credit agreement in future.
Don't fret, though, because, under the National Credit Act and laws, the credit bureau must remove the debt review indicator and update your record upon receiving a credit clearance certificate. In the Debt review industry, this credit clearance certificate is called a form nineteen.
This means that once you complete your debt obligations under the updated terms, the credit bureau clears you and updates your credit record. Thus, it allows you to get new lines of credit without fear of getting turned down.
Flexible Repayment Terms
The most obvious benefit is that you get a new flexible repayment agreement. For one, your debt advisor can negotiate to reduce your loan interests, so you can afford to clear it on time.
Second, your installment amounts can be reduced so you can manage to make monthly payments on time.
Lastly, you'll enjoy an extended repayment period, allowing you to meet all your financial obligations. These new loan agreements ensure you're not over-indebted and overstretched to meet your living expenses and other commitments, a win-win for you and the creditors.
It's Affordable
Seeking debt counselling only means you're experiencing financial constraints. So, paying more money for it would go against your goal to reduce your debts. Fortunately, a debt advisor's fees are affordable, allowing you to get expert help without breaking the bank. Furthermore, this deductible fee is already included in your repayment plan while under the counselling process.
Less Financial Burden on Your Guarantors
When you fail to repay some loans on time, the creditors start owing your guarantors. It's unfair to let this burden fall on your guarantors, who could be your parents, spouse, siblings, or friends. The reason is that it can strain your relationships and inconvenience your guarantors.
With debt counselling, you can prevent this from happening by committing to new restructured repayment terms. So, you'll protect your loved ones from creditors and your reputation.
What to Look for in a Debt Counsellor
Now that you've learned the rewarding benefits of debt counselling, the next step is to find a company or a debt counsellor that suits you best. At the same time, there are many excellent debt counsellors. You want one that understands your predicament and offers solutions you can take on.
When looking for a debt counsellor that's right for you, consider working with non-profit or for-profit debt counselling firms. Then proceed with the following steps.
- Know which services they offer
- Depending on your needs, the counsellor's services will determine if they're right for you. You want to look for one with many if not all the services you require. This way, you're sure to get the best solutions and achieve your financial goals.
- How much do they charge?
- As aforementioned, each debt counselling firm charges differently. Additionally, your requirements will determine how much they'll charge you. So, it's best to consider their rates to settle on one that fits your pockets.
Besides, affordability doesn't equate to inability. You can find an affordable counsellor just as good as an expensive one.
Please take note that The National Credit Act has set maximum fees, and some debt counsellors do not charge you for administration or application fees. Some debt counsellors use expensive law firms, while others try to obtain court orders from the Tribunal. A nominal fee is charged by the Tribunal and not as costly as law Firms. You'll save money at the end of the day if you use a debt counsellor who can help you avoid using expensive law firms.
Confidentiality
Discretion is of utmost importance when choosing a debt counsellor. It'd be risky and problematic if your information were to get into the wrong hands. Moreover, confidentiality indicates professionalism and trust. You need to trust your debt counsellor if you're to take their advice and work in harmony.
Accreditation
You must never consult with a counsellor with no accreditation. NCR Accreditation is more than a piece of paper. It indicates the ability of a debt counsellor to provide legal advice and help clients. Thus, the first step when listing potential debt advisers is to check their accreditation. Taking this step will help you avoid legal issues, confidentiality, frauds, and other issues in your credit relief process.
Process of Debt Counselling; Debt Review
Debt counselling is a rewarding experience. But to be better prepared for it, you must know what it entails. That way, you will arm yourself with the essential information and expectations when you finally pick a debt counsellor. Here's a brief rundown of the counselling process.
- Assessment
- During your initial consultation with a debt advisor, they will conduct an official assessment of your finances and debts. This assessment consists of research and investigations into your current finances and assets.
- When your debt review counsellor determines that you are over-indebted, they may recommend that you begin debt counselling immediately.
- Protection
- Once you agree to begin the process, your advisor will take it up with your creditors. No longer will you communicate with your creditors directly or fear property repossessions. Instead, your advisor will handle it all. First, they will approach the creditors to inform them of your formal application for debt counselling. Then they will continue communication on your behalf to secure the most suitable repayment agreement.
- Negotiations
- At this stage, your counsellor will begin negotiations for flexible repayment terms with your creditors. They will work out reduced interest rates, extended payment periods, and lower installments. The process happens at least 48 hours after your application. Although you must stick to the new repayment terms, you can always increase your monthly installments if you can.
- Follow-Ups
- Here is where your Debt Management Company will follow up with creditors to ensure a seamless process and progress. Because your adviser will need a record of your payments, they'll follow up with your paid-up settlements and provide progress reports to you.
- Debt counselling/ Review Removal
- There are milestones you must reach before withdrawing from the program. One milestone is obeying your restructured instalments to the letter. The other can be setting your counsellor's fees. Once you complete these, then you can jumpstart your debt counselling removal process.
- Clearance Certificate
- After settling all the financial agreements included in your court order, your debt counsellor can present your clearance certificate to the credit bureau. The process will clear your name from the credit bureau in South Africa, allowing you to qualify for new credit lines.
Get Debt Counselling Support from Experienced Advisers
Regardless of age, financial status, and number of debts, everyone can benefit from debt counselling. Thanks to the National Credit Act (NCA), debt review advisors are mandated to offer this service to help people with debt management and offer future financial stability.
Even if you're not in massive debt, a debt counsellor can help you streamline your finances. Besides, you'll not make bad financial mistakes like accruing debts.
So, make that choice today and contact our team to learn your options for debt management. We'll take you through your options and ensure you leave our offices satisfied.