When debt becomes unmanageable, consumers are often wary to ask for help. Instead they look for quick fixes, short term loans, or skip payments in order to keep their heads above water. There exists a myth that asking for help with debt will result in financial ruin and an unfixable credit history. This is not true.
Since the promulgation of The National Credit Act in 2007, consumers have been given an olive branch. The act makes provision for debt counselling, and this means that consumers stand to benefit immensely. It provides a service for consumers that can help them pay off their debts when they have become over-indebted.
A debt counsellor works in conjunction with the act to provide a consumer the breathing space to right their finances. They restructure the budget of the consumer and negotiate with their creditors to reduce payments and interest rates, in order to make the debt more affordable to a consumer.
A debt counsellor can also offer expert advice when it comes to debt management, whilst providing guidance during the consumer’s time under debt review. This advice can help a consumer avoid future debt problems once their debt has been paid off.
A wise consumer should not shy away from asking for debt help because the law has taken great strides in ensuring the protection of their assets and financial position if they resort to debt counselling. Consumers who do not ask for help can face legal action or asset seizure due to lapsed debt payments, however debt counselling prevents these actions from being taken.
In short a debt counsellor is the prime option when seeking help to pay off debts. Instead of approaching money lenders or selling off assets, just ask them to help you legally battle debts that are out of control.
Article written by: Andrea van Tonder 06-2013