Debt Counselling and debt administration - differences
1. The idea behind Debt Counselling is to help clients reduce their overall debt with creditors in the most cost effective way.
An Administration order can take a large part of your disposable income to offset the relatively high cost.
2. Debt Counsellors have been introduced by the National Credit Act in order to specifically deal with people in trouble with their finances and therefore have the support of and have to be approved by the Government.
An administration order was used prior to the new Credit Act with the view to resolve an individual's overindebtedness. However this method can be very costly and with various limitations.
3. Unlike under an administration order, 95% of your monthly payment will go to your creditors under a debt counselling plan.
4. Our debt counselling plan will manage all your payments to creditors from a central distribution agency on a monthly basis on your behalf.
Under administration, distribution by Lawyers is only done once every three months after all their costs have been deducted (In some cases it can take longer than a year before your creditors' receive any form of payment).
5. Any amount of debt can be consolidated through debt counselling.
Your debt can not exceed R 50,000.00 in order to be placed under administration.
Company Registration No.2005/001817/07.
