In South Africa, more and more Consumers are over indebted and make application to a Court of Law to be placed under Debt Review.
A Consumer’s financial position might not always remain the same and may improve to such an extent, that making payments in terms of the granted Court Order, is no longer necessary and/or his or her debts or part of such debts may have been paid up.
This article will discuss how the Debt Review Process can be terminated and removed as well as the process that needs to be followed (by a Consumer) when a Court Order has been granted.
How can a Consumer Terminate Debt Review Proceedings?
The National Credit Guidelines assist Consumers herein by providing a summary of the National Credit Act No 34 of 2005, as amended (hereinafter referred to as the “the Act”).
Section 71 of the Act states the following:
(1) A Consumer whose debts have been re-arranged in terms of the Act or where a Court Order has been granted, must be issued with a Clearance Certificate by a Debt Counsellor within seven days after the Consumer has:
(a) Satisfied all the obligations under every credit agreement that was subject to that debt re-arrangement order or agreement in accordance with that order or arrangement; or
(b) Demonstrated financial ability to satisfy the future obligations in terms of the re-arrangement order or agreement under:
(i) any long-term agreement as may be prescribed;
(ii) That there are no arrears on the re-arranged agreements contemplated in subparagraph (i); and
(iii) That all obligations under every credit agreement included in the re-arrangement order or agreement other than those contemplated in
subparagraph (i) have been settled in full.
(2) A Consumer under Debt Review can only be issued with a Clearance Certificate when one of the following has occurred:
(a) The Consumer has either payed up all his/her debts which were listed in the Debt Review Court Order or Debt Review Repayment Agreement; or