If you find yourself missing debt repayments, you are not alone. Almost 50% of all credit active South Africans are in arrears on at least one account. Is there a solution? Actually yes – there is a great one. Debt counselling was introduced into the National Credit Act (NCA) in 2007 as a solution to help over-indebted consumers manage and pay off their debts.

The first step to getting your debts sorted is to speak to an expert. Some people find it hard to admit that they need help and try get out of the debt spiral by themselves. This often results in taking out more debt. Borrowing from friends and family can also be risky.

How does Debt Counselling work?

Debt counselling is the one solution that allows you to reduce your debt repayments, keep your assets and it prevents you from using more debt. It thereby focusses on getting debt-free as fast as possible. But how do you choose who is going to help you, as it seems there are hundreds of debt counsellors out there?

It is also important to note that there are a few fly-by-night, one-man shops out there. There may also be companies that do not offer satisfactory levels of service. You need to choose a reliable debt counsellor that will be there in the long run and is interested in helping you, not purely in it to make money. We have compiled a check-list to help you make the best decision.

1. Make sure that the Debt Counsellor is registered with the National Credit Regulator (NCR)

You should ask the debt counsellor for their NCR number (e.g. NCRDC 2955) or you can quickly check for yourself on http://www.ncr.org.za/register_of_registrants/registered_dc.php

2. Ask the debt counsellor if they use DCRS (Debt Counsellors Rule System)

DCRS is a system which calculates how much you need to pay in order to be debt free within a specific period. The biggest benefit of DCRS is that it reduces the high interest rates on your debts. This can save over-indebted consumers tens of thousands of rands. DCRS can reduce short-term debt interest rates down to as low as 0%.

3. Check their online ratings

Nowadays it is quite easy to verify if a company is what it says it is. Using online ratings is what many people do to choose service providers and make purchasing decisions. It is no different for debt counsellors. Check their Google, Facebook and HelloPeter ratings to see what others have to say about them.

4. Check upfront how much the fees for the entire process will be

Due to debt counselling being a legal, regulated process, all fees are also regulated. These are governed by the NCR. The fees are capped and are paid to the debt counsellor for all the work that they do.   ——Check the debt counselling fee guideline. The main fees involved with the process are the Restructure Fees, the Sundry Fees and the Aftercare Fees.

5. They must be easily and readily available

Being a service provider, a debt counsellor should always respond to you timeously. Debt counselling will be an important part of your life for a few years. Make sure that the party responsible for managing this for you is easy to get hold of. Test this by phoning into the call-center or emailing to see how quickly they answer. Debt counsellors using Facebook and Whatsapp are also good options.

6. They should also by making use of registered Payment Distribution Agency (PDA)

The PDA will take your new monthly debt repayment and then distribute it to each of your credit providers according to the new arrangements that your debt counsellor has made with them. They facilitate payments for you and send you a monthly statement. You will therefore be able to see how much each creditor will receive each month.

To get a call from one of SA’s most trusted debt counsellors, fill out a Free Call Back Form so that Vantage can get hold of you and help you today.