If you’ve been through debt review, you may be wondering how to get out of it once your financial situation has improved. In South Africa, the debt review process offers much-needed protection to those struggling with debt, but when you’ve regained control of your finances, you’ll want to exit the process and have the debt review notice removed from your credit record.
Here’s a breakdown of how the debt review removal process works and what steps you need to take to regain your financial freedom.
What is Debt Review?
Debt review, also known as debt counselling, is a legal process governed by the National Credit Act (NCA) in South Africa. It’s designed to help over-indebted consumers by restructuring their debts so they can afford to repay them. Under debt review, you cannot access new credit until the process is completed, and your credit record is flagged with a “debt review” notice.
Debt review can be a lifeline if you’re facing unmanageable debt, but once you’ve paid off your debts or your financial situation has improved, the next step is to remove the debt review status from your credit profile.
Steps to Remove Your Debt Review Status
- Assess Your Financial Situation Before you can start the process of removing your debt review status, you must be sure that you are no longer over-indebted. This means you are financially capable of paying off your debts without the need for debt restructuring. If you’ve paid up or settled most of your accounts and can afford your monthly repayments, you’re in a good position to begin the removal process.
- Obtain a Clearance Certificate Your debt counsellor plays a key role in this step. Once you’ve settled all your debts (excluding home loans), your debt counsellor will issue a clearance certificate. This document proves that your debts under review have been fully repaid. If your home loan is still active, it must be up to date, and you must show that you’re managing the repayments.The clearance certificate is essential for starting the process of removing the debt review flag from your credit record.
- Apply for Court Order (if necessary) In cases where a court order was originally granted to place you under debt review, you’ll need another court order to remove the debt review status. This application can be done through your attorney, and it’s important to show that your financial status has improved significantly.If you were placed under debt review without a court order, this step may not be required. However, consulting with your debt counsellor or attorney is essential to ensure you follow the correct process.
- Notify Credit Bureaus After receiving your clearance certificate, your debt counsellor will notify the National Credit Regulator (NCR) and the credit bureaus that you’ve completed the debt review process. The debt review notice will be removed from your credit profile, allowing you to apply for new credit in the future.
- Update Credit Bureaus via NCR Debt Help System The NCR Debt Help System is a key tool in South Africa’s credit regulation landscape. Your debt counsellor will use this system to notify credit bureaus that your debt review status should be lifted. Once updated, your credit profile will no longer display the debt review flag, and your financial standing can start to improve.
How Long Does the Process Take?
The time it takes to remove the debt review notice depends on several factors, including the efficiency of your debt counsellor and the speed at which the credit bureaus update your profile. Typically, the process can take between 30 to 60 days from the time you receive your clearance certificate. It’s important to follow up with both your debt counsellor and credit bureaus to ensure that the process is completed in a timely manner.
Can You Apply for Credit After Debt Review?
Once the debt review notice has been removed from your credit record, you can begin applying for credit again. However, it’s essential to proceed with caution. Your credit score will take time to recover, and you’ll want to build good credit habits to restore your financial reputation. Start by taking on manageable forms of credit, such as a small loan or credit card, and make timely payments to gradually rebuild your credit score.
Key Takeaways
- The debt review removal process starts once your debts are fully settled or your financial situation has improved.
- A clearance certificate from your debt counsellor is required to remove the debt review status.
- The National Credit Regulator (NCR) and credit bureaus need to be notified to update your credit profile.
- The process can take 30 to 60 days, after which you can start applying for credit again.
Exiting debt review is a big step towards financial independence. With the right guidance and by following the legal steps, you can successfully remove your debt review status and begin rebuilding your credit profile for a better financial future.
If you’re looking for professional help to guide you through the debt review removal process, reach out to an accredited debt counsellor or financial service provider. They can help ensure that the process is smooth and successful.
