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Debt review is not for everyone, often some debts have passed the point of rehabilitation and a consumer might have to consider alternative debt management measures.
Factors that might stop a consumer from being approved for debt review include the following:
- No income. If a consumer does not have an income; they are in any position to pay off their debts. Without an income, a debt counsellor cannot do a financial assessment for a debt review application, nor can the consumer guarantee that they will be able to pay their debts. It is vital to prove that you have income through bank statements and payslips where possible.
- Judgments, court orders, summons and notices of attachment. When a consumer has lapsed in their payments enough for any of these legal steps to be taken, the courts and creditors may choose not to grant them debt review. A house that is scheduled for auction under a notice of attachment cannot be saved through debt review and will be excluded from the application. The same applies to debts where a summons has been issued.
- Unemployment and the inability to make payments. If a consumer is already under debt review but loses their job and suddenly finds themselves unable to make payment, there is a possibility for a short grace period. However the onus will rest on the consumer to seek alternative employment and begin payment as soon as possible, or else debt review process will be halted.
Article written by: Andrea van Tonder 03-2013