Debt review is a structured process designed to help over-indebted South Africans regain financial stability. Understanding its duration and benefits of debt counselling can assist you in making informed decisions about your financial future.

How Long Does Debt Review Last?

The duration of debt review typically timeframe ranges from 36 to 60 months, equaling 3 to 5 years (Based on the average debt review client). However, the exact timeframe depends on several factors:

  • Total Debt Amount: Larger debts may require a longer repayment period.
  • Your Affordability: The more you can afford towards your debt the faster you would be able to settle your debt and complete the debt review process.
  • Repayment Plan: The terms, such as interest rate reduction and cancelation of service fee agreed upon with your creditors, facilitated by your debt counsellor, influence the duration.
  • Monthly Payments: Your ability to make consistent payments as per the restructured plan affects how quickly you can complete the process.
  • Extra payments: If you are ever in the position to increase your monthly debt review payments, pay in a lumpsum or settle any debt, you may do this with the guidance and advise from your debt counsellor to shorten your time under debt review.

Once you settle all your debts, excluding a home loan if applicable, your debt counsellor issues a clearance certificate. This certificate confirms that you have completed the debt review process. It also removes the debt review status from your credit profile and clears any negative or adverse information, such as missed or short payments, from your record.

Image of a confused man gesturing with the text, "How long will I be under debt review?" and the DCGsa logo below.

Benefits of Debt Review

Engaging in debt review offers several advantages:

  • Immediate Relief: Once you formally apply for debt review by signing the form 16, You will pay your reduced payment towards your debt from your next pay day.

    Legal Protection:     Creditors cannot take legal action against you while under debt review and sticking to payment terms.
  • Asset Safeguarding: Your assets, such as your home and car, are protected from repossession as soon as you apply.
  • Reduced Monthly Payments: Debt counsellors negotiate with creditors to lower your monthly debt repayments, making them more affordable.
  • Interest Rate Reduction: Negotiations often lead to reduced greatly interest rates on unsecured debt, decreasing the total amount payable over time. Saving you thousands of rands.
  • Fee Cancelation: All credit agreements have service and / or admin fees, in most cases these fees are removed under debt review. This makes way for a consolidated fee that is paid to the debt counsellor that is generally a lot less than what you were paying on all your accounts combined, saving you money. If you were being charged for late payment fee, over-limit fee, cash advance fee, facility fees or excess fees, you will no longer pay these fees while maintaining your debt review payments.
  • Credit Profile Restoration: Upon receiving a clearance certificate, all negative credit information related to the accounts included in debt review is removed from your credit profile within 21 business days. This restoration is typically faster than the standard period for negative data to remain on your profile after settling debts outside of debt review, which can last up to five years.

Conclusion

Choose a registered Debt Counsellor who understands how to negotiate the best deals for your situation and provides honest feedback about your budget. A trained professional offers a valuable third-party perspective, ensuring you make informed decisions and achieve the best possible outcome for your financial future.  Debt review offers a viable path to financial recovery, with a duration tailored to your specific circumstances. The process not only aids in debt repayment but also ensures the swift restoration of your credit profile upon completion. Engaging with a qualified debt counsellor can provide the necessary support and expertise to navigate this journey effectively.

Contact DCGsa for Expert Guidance – Or find out if you qualify for debt review.

If you’re considering debt review and need professional advice, DCGsa is here to assist you every step of the way.

For more information, on How Debt Counselling Works – CLICK HERE