The Ultimate Guide to Working with a Debt Counsellor

Several studies have shown that the average household in South Africa spends 75% of their take-home pay on paying off their debts. Getting out of debt is not a quick or easy task, especially if you need financial help at the same time but getting out of debt can help you save money, improve your credit score, and help you achieve other financial goals.

Working with a debt counsellor is the best way you will be able to obtain help with debt management, as your counsellor will be able to guide you step by step. What is debt counselling, and how can it help you if you are experiencing financial difficulties? Would you like to find out if it is the right solution for your problems?

By reading this guide, you will learn everything you need to know about working with a debt counsellor to deal with high debt.

What Is Debt Counselling?

Debt counselling or debt review is a service that is available through many different debt review agencies.

Debt Review agencies are registered entities per the National Credit Act and provide everything from financial advice to money management workshops, among other services. They can help you with immediate financial relief, negotiations with creditors, restructuring, creating a new budget, providing free educational materials, and more.

During this one-on-one session, you will meet with a financial relief professional. As your debt review advisor walks you through your finances with you, they will be able to help you produce a customized plan that will work best for your financial situation. An individually tailored restructured plan for paying down your accounts will help you to achieve a much better chance of succeeding.

Who Can Benefit from Debt Counselling?

Debt review counselling can be a helpful financial resource for a consumer, irrespective of how dire or mild their financial situation may be.

We find that, in most cases, our debt counselling services are most beneficial to people who are unorganized or do not feel knowledgeable about finances. It is because debt counsellors can make the process easier by providing free advice and information to consumers.

With their well-informed and objective advice, you can feel confident that you can make better decisions and improve your financial situation while getting immediate financial relief.

Debt counselling is also beneficial for people that struggle to stay accountable for their financial goals. Having someone to keep you accountable will ensure you do not lose track of what you need to do. They will also ensure that you make your payments on time if you have been declared overindebted and have a restructured financial management plan.

The process will provide you with helpful information, regardless of whether it can solve your financial problems. In addition to keeping, you on track to reach your financial goals, it can provide you with all the tools you need to achieve them.

What Happens During a Debt review Session?

Your debt Review or debt counselling session will start with an overview of your existing financial situation. This overview will include your income, expenses, debt repayments, and interest rates, among other things. You and your debt counsellor will go through all this information together to help establish a realistic budget that includes reasonable living expenses.

They will help you reduce your spending habits and trim your expenses while repaying your creditors. You will not only be able to get out of trouble, but you will also be able to prevent yourself from getting into more trouble in the future.

Your debt counsellor offers other solutions, like interest rate reductions, reckless lending investigations and investigations into prescribed accounts.

Our professional and registered firm usually provides some free services to help you with your budget and to provide you with other free financial information and educational materials. As part of this process, you will often be offered a free credit report review from a credit bureau so that you can take a closer look at the state of your finances right now.

You will also receive a list of steps you can take to improve your financial situation. Instead of searching online for resources, our team will walk you through each step to meet your specific financial needs.

Do you pay for Debt Review?

Debt review fees charged by debt counsellors are regulated by the National Credit Regulator (NCR) and incorporated in your monthly repayment amount, so there will be no additional fees. As part of the legal process, the company you selected to help you with your finances usually receives the first payment.

The money will be paid to your creditors systematically from the second month onwards. Please note that your restructured amount might not always be enough to cover your legal fees. In some cases, if your restructured amount is small, your creditors may receive their agreed upon monthly payment in month three.

In the proposal to creditors, we will specify that this will be the case, and your creditors will restructure your account so that they can receive payments in month three. For an in-depth analysis of the regulated charges, please follow the recommended and regulated fees link here.

How Should You Choose a Debt Counsellor?

The number of consumers who feel they need a debt counselling company to assist them with their problems is growing every day. As this is an undertaking that may last for up to 60 months, it is imperative that you select a reputable company that will help you with this process and help you settle all your creditors effectively.

While most credit or Debt counsellors provide similar services and adhere to the same rules and regulations found in the National Credit Act, not all financial relief companies deliver the same quality of advice. Therefore, this is the reason it is imperative that you should be incredibly careful when choosing your financial relief organization. Often, you can get free information about a debt relief organization and will not have to provide any personal information before the service.

• The first thing you should look for in a debt counsellor is what services they provide. These can range from budget counselling to helping you manage your spending, and financial management and if they use expensive attorneys for court orders or provide a cheaper alternative such as the National Consumer Tribunal (NCT).
• When working with this type of financial relief organization, you should look for a company with a wide range of services, not just debt management or debt review.
• Use only a professional registered professional to help you with your creditors. A debt counsellor must have a registration with the NCR, and the NCR expects that they will provide current information about the debt counselling process to their client base. Visit the NCR website to verify if the company is registered.
• Make sure your financial relief counsellor does more than only push a restructuring management plan.
• Debt counsellors should act in your best interest and not just impose products on you.
• Review sites that support and affirm the quality-of-service experience that other users have had with a particular company. Not having reviews or receiving a host of bad reviews usually means you will pick up trouble at some point during the process.
• As part of the debt counselling process, a debt counsellor who specializes in this area should be able to explain the process of debt counselling to you in detail.
• Before making any recommendations regarding your finances, your financial adviser should consider your personal financial situation first before making any suggestions.
• Moreover, it would be best for you to look for a counsellor who offers free educational materials as part of their services. In this way, you will be able to get expert advice without having to pay any fees in exchange for it.
• It is essential that the company you choose uses a payment distribution agency that has a good reputation in the industry. If a company asks for upfront fees, stop immediately. It is illegal for debt counselling professionals to request upfront payments.
• The debt counsellor must be available to assist you with any queries or issues you may have in the future. If the company you approach does not have any reviews, it is best to look for one with a more reputable reputation.

What does a debt Counsellor do?

If you have struggled to pay your accounts or are having budgeting difficulties, a debt review company or a debt counsellor can help. They can also help you formulate a budget and provide suggestions on money management. Furthermore, debt counsellors can negotiate with your creditors and restructure all your credit agreements into an affordable amount through the negotiation of a consolidated instalment plan.

On 10 March 2006, the National Credit Act 34 of 2005 (NCA) enacted the National Credit Regulations (NCR), which govern the process.

Learn more about the Debt Collection Rule and your debt collection rights.

A debt counsellor is trained and certified in several areas, including consumer credit, money management, reckless lending, restructuring and consumer debt and money management. You will notice from the above description that this financial relief professional becomes one of the most crucial people in your quest to get out of debt with high-interest rates. An experienced financial relief professional can give you immediate financial relief in addition to developing a personalized plan to solve your money problems based on your financial situation and needs. The following are some examples of what you can expect from our consultants:

1. Offer immediate financial relief.
2. Assist with the prevention of repossessions by assisting with the stoppage of foreclosures
3. Help you manage your money and credit providers effectively, enabling you to live a more fulfilling life.
4. Create a budget suited to your needs based on your income and expenses, and then make sure you still have enough money left to cover your living expenses.
5. In addition to providing, you with a copy of your credit report and scores, we will discuss what factors made you slip into debt.
6. Our regulated firm will represent you in negotiations with your creditors, restructure your credit agreements under a financial management plan, and reduce interest rates to help you repay your accounts conveniently and cheaply.
7. Following the completion of the process, you will receive a clearance certificate. As a further step, we guarantee that your credit record is 100% free of any adverse information so that you have a perfect credit history.

What Is a restructuring Debt Management Plan?

Typically, a debt counsellor will help you create a debt management plan during your counselling session.

With the help of a restructuring management plan or program, you can pay off your accounts due to your creditors through a financial management agency, commonly known as a payment distribution agent (PDA). Payment distribution agents will arrange for your creditors to be paid each month in line with the recommendation made by your debt relief company instead of you making payments to your creditors directly. They will schedule your payments in accordance with your debt counsellor’s proposal and court order.

Debt counsellors may even be able to get your creditors to lower your interest rate or even waive some of their fees in some cases.

Be sure to know how long it will take to repay your balances if you sign up for a restructuring financial management plan. Debt review processes require you not to take on any additional credit during the period, and you can plan if you know how long the process will take.

Benefits of Debt Review

Considering working with an experienced debt relief professional is one of the best things you can do for yourself in terms of debt management. The following is a list of the benefits you can look forward to:

• One of the key benefits of availing yourself of this service is that you will have access to expert financial advice from experts in the field. With the help of a debt counsellor, you can get professional assistance to lower your monthly payments, improve your budget, and become debt free in no time. Prioritizing your basic living expense needs before making provisions for your debts is the priority of a debt counsellor.
• You can improve your financial habits by using many free online resources. For some people, this can be extremely helpful; however, a debt counsellor can provide you with personalized advice and real solutions individually tailored to your unique financial circumstances and thereby help you make wise decisions.
• It is illegal for creditors to take legal action against you while you are in the debt review.
• You will be able to consolidate your monthly debt repayments into a single monthly payment that is both affordable and manageable.
• Getting help with your debts can also help you reduce stress, making it another significant benefit of debt counselling. Being in financial hardship or living salary-to-salary can make you feel that your life and finances are out of your control and that you have no control over them. A debt counsellor will immediately relieve this concern.
• Getting a free financial review will give you some simple steps you can start taking to regain control over your finances.
• Even if you don't think you have financial problems, debt counselling can reveal problems you didn't realize you had. In this way, you can avoid getting into financial difficulties in the future. It will also help you create a budget for the future to keep your income and expenses balanced.
• As a result of reviewing your debt under debt review and working with a registered and regulated firm, you will avoid paying more than you can afford, save money, and cut costs.
• Your creditors will no longer call you requesting payment for the balances you owe them.
• Lastly, working with a debt counsellor will help you get out of trouble faster. With a restructuring management plan, you can avoid making late or minimum payments to pay off your balances more quickly. Plus, your debt counsellor might be able to help you find more room in your budget. This way, you can use your extra money to make larger payments to get out of trouble more quickly.

How to Get the Most out of your Debt review Service.

In contacting a debt counsellor or a debt review counsellor for help in getting your finances in order, you have now taken the first step towards achieving your goals of improving your financial life. However, it takes a lot of effort to get out of debt. You cannot expect to be able to completely change your financial situation just by working with a debt counsellor. You can make the most of your relationship with a debt relief specialist by following these tips:

1. Before and after your debt review counselling application, commit yourself to the process.
2. Before you apply for this debt relief service, you should take some time to gather all your relevant information. Getting your financial documents together will ensure that your debt counsellor possesses all the information they need about your financial standing. As a result, they will be able to provide you with customized, accurate advice based on your needs.
3. Some people may try to disguise their real financial woes when they apply for help. There is no judgement involved in our service. Our services are here to help you get immediate financial relief, so keep that in mind. To have a good relationship with your debt counsellor, you should be completely honest with them and mention all your credit agreements in detail. The loan sharks you visit monthly for loans will also need to have their information included, so elaborate on all the pertinent facts, even if they seem irrelevant. For us to fully understand your needs, please share as much paperwork as possible, including your current budget calculations.
4. Furthermore, you should be ready to act on the advice that you receive if you want to get the best results. There is no doubt that setting a strict budget can be difficult. But, to get out of financial difficulty in a timely manner, it is often necessary to make these sacrifices.
5. You do not need to accept every piece of advice you receive. Still, you must be confident that you are willing to alter how you manage your financial habits. It will make it easier for you to get out of debt and to avoid getting into trouble in the future if you do this.
6. Be clear about your financial goals. You might think there is a good chance you will be able to pay off your outstanding balances within a year or two. Alternatively, you are hoping for five years instead of seven. Do not be afraid to express your expectations to your financial relief professional, no matter what they may be. Certain factors may determine whether we achieve all these expectations. It is possible to achieve expectations with proper planning and commitment. Your repayment efforts, extra payments during the process and the extent of your debt will determine the outcome.
7. Keep your finances organized. Often, people in debt feel overwhelmed because there is a mountain of paperwork for them to deal with. It is common for collection agencies to send monthly reminders to debtors. These account notifications may have become so tiresome to you that you no longer look at them. Gather everything in one place and divide it into bundles - one for each creditor you owe money. It will be appreciated if you make any effort in this direction since it will make our work easier in identifying which creditor needs urgent attention. If you receive a call, text, or letter from a collector, please notify your debt counsellor immediately. Procrastinating or ignoring these calls and letters will lead to unnecessary problems later.

If I'm not happy, can I change Debt Counsellors?

Please note that you may change your debt counsellor at any time if everything you owe to the debt review firm has been paid up to date and we will assist you in completing this process. Moreover, you need to be aware that your new company will not be able to restart the restructuring process and will not be able to charge you again for restructuring fees.

Conclusion – Is working with a debt counsellor beneficial or right for you and is debt review a good idea?

When you are struggling with your finances and can't seem to get rid of debt, it can feel impossible to gain financial freedom. Working with a debt counsellor can help you learn more about finances and money management and can help you create a customized debt management plan.

If you need help finding a debt counsellor, Credit Salvage can help! This regulated process simplifies the repayment process, optimizing your ability to pay off your debts on time. Debt counsellors can negotiate lowered interest rates and lower monthly payments. Working with our agency can be an effective financial relief option if you:

1. Struggling to pay off high balances
2. When your vehicle or house is about to get repossessed due to non-payment
3. You have not paid your accounts for more than two months
4. Having trouble affording monthly account repayments for multiple accounts.
5. Are you looking for a quick solution to your financial problems?
6. You would like to learn how to manage your finances in a better way.
7. You would like some guidance regarding achieving your financial goals and settlements.

There is no shame in being in debt. It is an unpleasant fact. Take control of your finances and regain your peace of mind by knowing what relief options are available to you. Contact our team today to learn more about our professional debt review services or to learn more about our other resources to help you gain financial freedom.