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Understanding debt review terminology
Navigating the world of debt review can be confusing. Here's a comprehensive guide to help you understand the key terms you'll encounter on your journey to financial freedom.
A formal debt rehabilitation process regulated by the National Credit Act (NCA). It protects over-indebted consumers from legal action while they repay their debts through a structured payment plan.
A registered professional who assesses your financial situation, negotiates with creditors, and creates a manageable repayment plan.
A financial state where a consumer cannot meet debt obligations based on income and expenses.
South African legislation regulating the credit industry and protecting consumers.
An authorised entity that distributes your monthly payment to creditors.
A new plan that reduces monthly payments and extends repayment period.
Issued once all debts are paid, officially ending debt review.
Organisations that track your credit profile and debt review status.
A legal court order that makes your repayment plan binding.
Debt backed by assets like a house or car.
Debt not backed by assets like credit cards or loans.
Credit given without proper affordability checks.
Negotiated lower interest rates to reduce total repayment.
A notice sent before legal action informing you of your rights.