Should You Talk to a Debt Counsellor?

Many South Africans hear this warning: “Do not talk to a debt counsellor or you will end up in debt review and lose access to credit.” This is not true. You cannot be placed into debt review unless you choose to and sign an official application form called a Form 16. Believing this myth is like not wanting to go to the doctor when you have serious pains in case they tell you that you have to go to hospital. Talking to a debt counsellor is not a trap (it is an opportunity to get expert help and understand your financial options).

Debt counsellors spend every day dealing with the banks and helping people work out more realistic and sustainable budgets. They can do far more than just place you under debt review. A consultation can include:

• Working out a fresh budget that actually works for your situation
• Checking your bank statements for fees or charges that should not be there
• Investigating old debts to see if they have prescribed (expired by law)
• Reviewing your payslip to see if deductions are legal
• Pulling your full credit report and explaining it to you in plain language
• Finding accounts you may have forgotten about or lost contact with
• Suggesting practical ways to cut your spending
• Advising you on how to contact your creditors and what to ask for
• Calculating whether debt review or other legal processes (such as sequestration) are options for you

Most debt counsellors offer these services for free because they genuinely want to help people. Even if debt review is not right for you, you will walk away knowing more about your finances and with real steps you can take to improve them. If you do decide to enter debt review by signing the official form, professional fees will apply and the process will be handled through the courts.

Avoiding a debt counsellor when you have serious debt problems is like avoiding the doctor when you have severe pain. You might avoid a diagnosis, but you will also miss the chance to find solutions. Talking to a debt counsellor can open doors to options you did not know you had and could be the first step to taking control of your money again.