Credit & Consumer Law

Debt Review

Debt review (debt counselling) is a formal legal process that restructures your debt repayments if you are over-indebted. While under debt review, creditors cannot take legal action or repossess assets.

Legal Definition

Governed by Section 86 of the National Credit Act 34 of 2005. A registered debt counsellor assesses your financial position and negotiates a restructured repayment plan. A court order is obtained and creditors are notified. Debt review ends when all debts are paid or the consumer demonstrates they are no longer over-indebted.

📖 Constitutional / Statutory Basis: Section 27 and Section 26, Constitution of the Republic of South Africa, 1996; National Credit Act 34 of 2005 s86

Practical Example

You cannot meet all your monthly obligations. You apply to a registered debt counsellor. After assessment, the court grants a debt restructuring order. Creditors cannot sue or repossess while you comply.

Frequently Asked Questions

Can I exit debt review early?

Yes — if you pay off all your debts or obtain a clearance certificate from the debt counsellor proving you are no longer over-indebted.

Does debt review affect my credit record?

Yes. You are flagged at credit bureaus during the process. The flag is removed once you receive a clearance certificate.

Can I get new credit while under debt review?

No. You cannot apply for new credit while under debt review.

Related Terms

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