HOW TO EXIT DEBT REVIEW
How do I exit debt review now that I can sustain my finances?
Benay Sager, chief operating officer at IDM Group, replies:
One way to exit debt review is to settle all outstanding debt. Pay all outstanding debt owed to your credit providers (except a home loan, which is considered a long-term agreement), request paid-up letters, and ask the debt counsellor to issue a clearance certificate.
This scenario only works if there is no home loan or if the home loan is not in arrears in terms of repayments.
Once all paid-up letters are supplied to the debt counsellor, you will be issued with a clearance certificate.
The debt counsellor will then ask the National Credit Regulator to move you to the appropriate code so that the status of “no longer in debt review” is reflected at the credit bureaus.
Another way is to rescind the existing debt review court order or obtain a court order declaring that you are no longer overindebted.
If you do not have a debt review court order, you can go to court based on the grounds of “improved financial situation” at any point in the debt review process to declare yourself no longer overindebted.
This will require proof of the improved financial situation – for example, a salary increase or a lump sum amount received.
The burden of proof rests solely on you to demonstrate that you are no longer overindebted.
If you successfully declare yourself no longer overindebted, you will once again be liable to pay your credit providers back.
Your debt counsellor will then ask the National Credit Regulator to move you to the appropriate code so that the status of “consumer has obtained court order declaring him/her no longer overindebted” is reflected at the credit bureaus.
If you underwent debt counselling and negotiated rates were implemented with creditors during this process, it is important to remember that, after being declared no longer overindebted, the repayments will most likely return to the payment amount owed before the negotiations took place.