Debtfree Magazine #8 2020 by Debtfree Magazine

5 THINGS O T D E E N U YO T U O B A W O KN W E I V E R T B E D Issue 8 of 2020

EXCELLENCE IS DOING ORDINARY THINGS EXTRAORDINARILY WELL â&#x20AC;&#x201C; John W. Gardner

WHAT MAKES US EXCELLENT? / Unimpaired and automated PDA systems / Integration with top-ranked Debt Counsellor systems / Enhancing Debt Counsellor efficiency and sustainability / Best customer support in the country â&#x20AC;&#x201C; queries are resolved within 24 hours / Strong compliance and best-industry-practice implementation is at our centre

Call Chris van der Straaten Head of Hyphen PDA | 082 557 0437 Or call our friendly support centre on 011 303 0060 - Option 2 or visit our website www.hyphenpda.co.za

Take Back Control Of Your Finances We provide a remedy specifically for over-indebted consumers which involves restructuring of debt payments, lowering interest rates and fees and lengthening payment terms. Debt Counselling could be the best gift you give yourself.

Call 087 237 7874 today! 2018 Debt Review Awards

WINNER

2018 Debt Review Awards

WINNER

DebtBusters voted SA’s BEST ‘National Debt Councellor’at the 2018: Debt Review Awards - for the 3rd consecutive year! Consumer Debt Help voted SA’s BEST ‘Large Debt Councellor’ at the 2018: Debt Review Awards - for the 5th consecutive year!

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FROM THE EDITOR When lockdown level 2 was announced, which were you more excited about: the prospect of a cold beer or legally visiting family and friends? It turns out that, though South Africa has one of the highest alcohol consumption rates (per capita) in the world, only around 35% of the South Africans are setting this (near world record) boozing rate. So, presumably, this means that most people were more excited about going to visit a friend, in person. But along with every IRL (in real life) visit, you run the risk of transmitting the virus, or contracting it from that friend and, infecting their family or yours! That does take some of the glow out of the reunion.

Of course, many people have a secret confidence, that if they personally do get infected, they won’t become too sick. This mindset is not unusual in many areas of life. Many people feel special, and exempt from harm, which is why hard times and setbacks can be a challenging mental obstacle for them to endure, ie. Those who drink and drive, or even just those who use credit. Most consumers accept that they will always be able to repay their monthly debts, and never ever consider what will happen if they can’t. Most new home owners and people financing cars innocently sign agreements that say the bank can take their homes and cars if they miss a single payment at some point in the next few years or decades. That is why this pandemic and lockdown are leaving many in a state of shellshock, unable to deal with the sudden outside force which has thrown their finances and financial plans into turmoil. Fortunately, debt review is there to help the many hundreds of thousands who were just scraping by, to deal with their debt. With a new wave of consumers considering debt review, in this issue, we discuss the 2 major benefits of debt review, and some crucial facts. We also talk about the upcoming Debt Review Awards on September 11th. Our team are all very excited to be part of the Awards process again this year. Due to COVID-19, the Awards announcements will be made online (on our YouTube Channel) this year. Our Team has expanded this year, and many of us are having to learn new skills, operate new equipment and practice, practice, practice to ensure the show runs smoothly. We appreciate all their hard work! For those who will ‘attend’ the show, we are confident you will have a laugh, be informed and entertained and enjoy taking some time to be part of the action. We look forward to hearing from our colleagues in other parts of Africa, and how their efforts at helping consumers deal with debt are going during the pandemic.

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For those who are in the running to take the top spots, we wish you all the best and will soon feature the top 50 Debt Counsellors (Top 10 in each size category) on www.debtfreedigi.co.za in the days ahead. A realistic and balanced view of the risk/reward in regard to all things including Covid-19, lockdown, credit use and debt review is always going to be more beneficial than just blindly hoping for the best. Many of us know somebody who got the virus and found it to just be a minor inconvenience, and also those who got the virus and sadly did not recover, we send you our condolences if your family has been affected. Educating ourselves about the risks and benefits of our choices in the weeks ahead, will guarantee we make the best choices for ourselves and our families. Armed with that information (and maybe a cold beer) we will be able to cope with challenges that come our way on our journey to becoming debt free.

DEBT REVIEW AWARDS

LOAN SCAMS

5 THINGS

CARTE BLANCHE

DEBT REVIEW

DISCLAIMER Debtfree Magazine considers its sources reliable and verifies as much information as possible. However, reporting inaccuracies can occur, consequently readers using this information do so at their own risk. Debtfree Magazine makes content available with the understanding that the publisher is not rendering legal services or financial advice. Although persons and companies mentioned herein are believed to be reputable, neither Debtfree Magazine nor any of its employees, sales executives or contributors accept

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C O N T E N T S

BREAKING NEWS

EXPERIAN GIVE FRAUDSTER 24 MILLION SOUTH AFRICANS CREDIT INFO Experian credit bureaus recently had to admit that someone had fraudulently gained access to credit records and the personal information of about 24 million South African credit users. Experian were not hacked. They were simply tricked into handing the information over to a person, who they thought was their client. They very quickly realized what had happened and immediately contacted authorities, notified the public and began to search for the trickster. A day later the authorities were able to swoop in and arrest the villain, before he had supposedly got a chance to sell the information to potential buyers. They recovered computers with the sensitive information on. The plan was supposedly to sell the personal information to insurance marketing agents. The information contained details about work history, credit ratings, types of accounts and judgments and payment history. It apparently did not contain account passwords or that sort of information, which credit bureaus do not have access to. Such information, if bought by a dangerous scammer, could be used to trick people into thinking they are dealing with their bank, and into giving someone information or access they should not have. The various banks have urged consumers to be careful, even though the credit bureau says the information was never sold or shared further than the fraudster.

LOAN SHARK KILLS CLIENT OVER R500 Noziswe Stefaans, a 46 year old female loan shark (from the Port Elizabeth area), went to collect on a loan made to Mr.Blom, a 32 year old male. Ms. Stefaans, brought her boyfriend with her to try to intimidate the consumer into paying. When Mr. Blom said he could not pay until the next week, Ms. Stefaans and her boyfriend took out knives and proceeded to stab Mr. Blom several times, resulting in his death. They then proceeded to stab 3 of Mr.Bloms’ family members who were in the house before grabbing valuables and making their getaway. Mr.Blom only owed R500. Ms.Stefaans was later arrested by the police for the murder, but her boyfriend, has thus far evaded arrest, the police are still searching for him. The Port Elizabeth Regional Court has since heard the case, and found that Ms.Stefaans did not show any remorse for what she did. As a result, she has been sentenced to life in prison (along with several other sentences that will run concurrently).

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CONSUMER FRIEND TAKE OVER EDCON (RCS BOOK) DEBT REVIEW MATTERS Not too long ago, RCS paid ABSA a whole lot of money to acquire much of the Edcon consumer credit and debtorsâ&#x20AC;&#x2122; book, and began to sell their services via Edgars and Jet stores. Now, many of those accounts, which have been put into debt review, will be handled by Consumer Friend. Most Edcon debt review matters are now going to be handled by Consumer Friend (there are a few accounts that wonâ&#x20AC;&#x2122;t be and Consumer Friend are helping Debt Counsellors figure out which ones are which). This change came into effect on the 14th of August 2020. For more info contact Edcon@consumerfriend.co.za or AMolelekeng@edcon.co.za

UP MONEY PONZI SCHEME COLLAPSES AND IS THEN REBORN A Ponzi scheme (called Up Money) which started in Tembisa has been shut down, but not before they conned over R42 Million out of consumers in just 2 months. While some members were supposedly getting their food parcels, if they could recruit enough new members and get them to recruit new members (etc), the Up Money operators were out blowing nearly R13 million by buying themselves cars like an Audi TT, Hummer H3 and a Jaguar XKR. Around 230 000 people fell for the scam before it caught the media and policesâ&#x20AC;&#x2122; eye. Authorities got wind of the scheme via the media, and soon began to investigate. The Asset Forfeiture Unit has since managed to seize the cars and even freeze a bank account containing over R18 Million. No sooner had the scheme been closed down by the cops, than their Facebook page underwent a simple facelift and a new scheme called MLM and the Mufhiwa Building Project replaced it. In a different version of the same pyramid scheme, consumers were now promised funds to build homes and pay off bonds. The scam has now stretched out into nearby countries, where their desperate consumers are also being conned.

MAGISTRATES COURTS DELAY MATTERS WHILE WAITING ON CERTIFICATES Due to the Covid-19 pandemic and lockdown restrictions, there has been a disruption to the usual process for the (NCR) to issue the many thousands of annual certificates of registration to Debt Counsellors and credit providers across the country. As a result, some courts have refused to hear these Debt Counsellors cases while they are waiting on the updated certificate. Fortunately, some Debt Counsellors were able to reach out to the NCR directly, and receive digital copies of their certificates, which they have been able to use in the meanwhile.

5 THINGS YOU NEED TO KNOW ABOUT DEBT REVIEW

INTRODUCTION Entering the debt review process can be intimidating. After years of handling your own finances, you might now be reaching out to a relative stranger for advice on matters that will affect you and your family for years to come. You are looking to this stranger to help you reduce your stress, and come up with a realistic way to handle your debt. More than that, you are starting a process that you may not know too much about. What are some facts that you absolutely need to know about debt review?

5 THINGS YOU NEED TO KNOW ABOUT DEBT REVIEW

THE COURT MAKES THE RESTRUCTURING ORDER A lot of people think that a Debt Counsellor interviews you, and then declare you to officially be ‘over indebted’ and eligible to have your debts restructured by the courts. This is a common misconception, even some Debt Counsellors believed this to be true in the past. The reality is, that only a Judge, Magistrate or the National Consumer Tribunal (NCT) can declare you over indebted, and only after they have reviewed your finances. Until this first step is completed, you are not officially over indebted. When a Debt Counsellor reviews your finances, they make a finding that you are most probably over indebted (can’t afford to cover both debt obligations and monthly running costs at the same time). They are also likely to find that you will become over indebted, if your situation does not improve. Based on that finding, they are able to take your matter to court or the NCT for a ruling. The Judge or Magistrate can then use the Debt Counsellors proposal, or make their own ruling on how your debt should be restructured and repaid.

5 THINGS YOU NEED TO KNOW ABOUT DEBT REVIEW

CREDIT BUREAUS RECORD YOUR APPLYING FOR HELP When you officially apply for help through a Debt Counsellor, they notify the National Credit Regulator (NCR) who in turn sends all credit bureaus the news that you have applied to have your debts reviewed. This information is then updated to your credit record. They are not recording that you have applied to have your debt restructured, only that you have asked a Debt Counsellor to review your debt (debt review). When Credit Bureaus add a note to your credit record that you applied for a debt review, it will likely make credit providers too scared to grant you more credit, even if you can afford it. This is because they are scared of what is called giving â&#x20AC;&#x153;recklessâ&#x20AC;? credit. If a credit providers gives someone credit recklessly, they can be fined up to a million rand. So, almost all credit providers will stop granting you credit and stop you from using the credit you already have. Credit bureaus will only remove this listing (that you applied for a review of your debt at some point in the past) once you have paid off all the debt you had at the time, and if a Debt Counsellor sends them specific official forms and documents. Until this time, they will keep that listing in place, even if you pay off all the debts.

5 THINGS YOU NEED TO KNOW ABOUT DEBT REVIEW

STATEMENTS MAY DIFFER When you start debt review, credit providers will change how they deal with your account. Some are able to get their computers to immediately separate your debts, but others struggle to get their computers to keep accurate records. While in debt review, you may make use of a NCR recognized (and audited) Payment Distribution Agency (PDA) to handle your payments. They make your life so much easier by handle all the payments on your behalf. The PDA will send you a monthly ‘statement’ of what amount they paid to who, and when. It is important to realize that the PDA statement and the various credit providers’ statements may differ a little bit, or even a lot if the credit providers’ computers are outdated. Differences also creep in based on interest calculations, and the date payments reflect verse the date they are actually made. This is why, near the end of paying up a debt (or every year), your Debt Counsellor, PDA and credit providers will all audit your account to figure out how much exactly is owed. This could mean that you end up paying either longer or shorter than your statement shows. There has been a lot of progress made in this area, and it is expected that one day, your creditor and PDA statements will be almost identical, to avoid any confusion. If you see anything very weird on one of your statements, it is a good idea to reach out to your Debt counsellor.

5 THINGS YOU NEED TO KNOW ABOUT DEBT REVIEW

YOUR DEBT COUNSELLOR When you enquire at a Debt Counselling practice, (like phoning a hospital), the person you first speak to might not be the Debt Counsellor (or Surgeon), that person is likely to be the receptionist, an administrative clerk or even a Debt Counsellors personal assistant. It is therefore wise to ask the person that you are talking to if they are registered with the National Credit Regulator as a Debt Counsellor. They wonâ&#x20AC;&#x2122;t be offended, donâ&#x20AC;&#x2122;t worry! They will understand that you are just checking that you are getting advice from a qualified person, who has done specialized training and written an official exam about giving debt review advice. Imagine getting advice about your heart operation from the janitor at a hospital. True, he may have a little more knowledge than a person on the street, but they would hardly be qualified to give you the best advice. Much like at a hospital where many doctors all work together, sometimes even on the same patient, many larger Debt Counselling practices have multiple qualified Debt Counsellors who can help you with your particular case. Always feel free to ask whoever you are talking to for their NCR registration number. Also if you are not getting the service you require from an administrative clerk or support staff member, then be sure to talk to your official registered Debt Counsellor. They can cut through a lot of red tape, and very quickly help you, communicate with the surgeon, not the janitor.

5 THINGS YOU NEED TO KNOW ABOUT DEBT REVIEW

LEAVING DEBT REVIEW The goal of every debt review and debt restructuring court order is for the consumer to eventually pay off their debts, and leave debt review. What is important to realize, is that debt restructuring is a legal process with lots of legal requirements. It is not like a short term contracts or subscriptions, you can’t just decide to walk away from the process. If a person under debt review suddenly decides to leave debt review, they cannot just stop paying their credit providers via their PDA and expect that their legal status will just revert to how it was before the debt review began. Likewise, credit providers can’t just decide that a person’s debt review is over, just because they say it is. As mentioned before, credit bureaus record your application for help, and will only remove that status once you have paid up all the debts included at the time, and once a Debt Counsellor officially proves to them you have no more debt. Until that is done, any consumer who just stops using the debt review process and thinks things will go back to normal, is simply fooling themselves. This will become very obvious if/ when they later apply for credit and are turned down. If you would like to leave debt review because your situation has improved dramatically, then you should have a full consultation with your Debt Counsellor (not one of their staff) and discuss how long this is going to take. It may still take you a while, but the good news is that you will still benefit from debt review while paying off your debts sooner.

5 THINGS YOU NEED TO KNOW ABOUT DEBT REVIEW

LEAVING DEBT REVIEW If you are thinking about joining debt review, then keep these 5 points in mind. When talking to a NCR registered Debt Counsellor about how the process works, feel free to ask lots and lots of questions. After those questions, ask more. Make notes, and make sure you understand what you are being told. If the person you are talking to is not able to speak to you in your first language, then feel free to ask them to arrange for you to speak to someone who does. If you get papers in a language you are not comfortable with, then ask for them in your home language. Never just sign and agree to something without knowing all the benefits and details involved. Get the facts and look before you leap! If you are already in debt review, you may have forgotten some of the facts mentioned in this article, view them as good reminders. Debt review really is an amazing legal process that has saved hundreds of thousands of peopleâ&#x20AC;&#x2122;s financial futures. The stress relief it brings has even saved peopleâ&#x20AC;&#x2122;s lives and marriages, perhaps it can help you.

DEBT REVIEW LESSON 1

The balances on your statements from your credit providers may not exactly match the one you get from your Payment Distribution Agents.

TWO THINGS YOUR DEBT REVIEW DOES FOR YOU Debt review is a fantastic way to deal with your overwhelming debt in a reasonable and affordable manner. Hundreds of thousands of consumers have been able to get their ‘financial life’ back on track by using the debt review process. Let’s take look at the short and long term benefits of debt review.

TWO THINGS YOUR DEBT REVIEW DOES FOR YOU

SHORT TERM BENEFITS Most credit users fall into the trap of relying too much on their available credit. Things can go wrong in a variety of ways, for instance, making poor decisions, or due to factors beyond your control (like a nation-wide lockdown due to Covid-19). Many people find it impossible to pay ALL their credit providers what they want each month, and still cover all their monthly needs (like groceries, electricity, insurance, telephone bills, rent). In this situation, most consumers begin to skip payments to one or another credit provider. This is when the collections calls and smsâ&#x20AC;&#x2122; begin. If the situation continues, consumers can quickly realise that they have maxed out all their lines of credit and can no longer use credit to pay for credit. When the threatening letters start arriving, or someone comes to collect one of your assets, this is when a lot of people finally turn to the help of a Debt Counsellor. Then they begin the debt review process. The benefits are almost immediate. Peace of mind comes because of taking positive steps to deal with your debt, the ability to tell collections agents that you have entered debt review, the composed help of a professional Debt Counsellor who lets you know that you are not going to be trapped in debt forever.

The Debt Counsellor also does some calculations and suggests two figures (1) how much you should be using to cover your necessary monthly running costs, and (2) how much should go towards your debts. Normally the figure they suggest towards paying off your debts is a lot more realistic and achievable than the consumer imagined, what a relief! More than that, the consumer is given a monthly budget figure to cover their daily needs, which they may have been neglecting. This is the primary short term benefit of debt review. Although the figure will perhaps be a little smaller than you hoped, it will be realistic. This monthly amount will enable you to cover vital costs, such as medication, groceries, insurance, electricity and municipal bills, telephone and internet as well as school fees and other similar expenses. The monthly budget figure will even include saving a little towards annual costs like car services, TV licenses and school clothes in the new year

TWO THINGS YOUR DEBT REVIEW DOES FOR YOU

LONG TERM BENEFITS Getting into debt is usually a much faster process than getting out of debt. Even outside of debt review many debts take 5, 7 or even 30 years (with bonds) to pay off. With debt review however, consumers are usually able to save thousands of Rand in fees they no longer have to pay, and interest that may be reduced during the process.

Concessions from Credit Providers Fees

For Debt Review consumer, most credit providers excuse the monthly account fees they usually add to accounts each month. For example, credit providers may normally add a monthly account fee of R60.00 If that consumer has 5 credit providers who all charge R60/month, that quickly adds up to R300 a month in just these small fees, never mind interest or other charges. If the credit providers excuses these fees under debt review, so that money can be used elsewhere.

The more accounts someone has, the more significant this is, as these fees can really add up.

Concessions from Credit Providers Interest

Anyone who has lots of different debts soon realizes how scary interest charges are. Due to high interest rates, even a smaller debt can quickly build up to impossible levels. Consumers who take out a bond, will end up paying 3 times the initial amount, paying mainly towards the interest. When the Debt Counsellor and credit providers negotiate at the start of the debt review process, credit providers will often make massive cuts to the interest portion of a debt. They do this to assist their consumer to repay the debt within a reasonable time. They know, if it takes too long, the consumer will never live up to the agreement. They really make amazing concessions in this area that can save consumers thousands and thousands of Rand. This means that while a consumer is under debt review, they are making significant saving on their debts that they would otherwise have had to pay, outside of debt review. Over time, this ultimately means that the consumer is able to not only pay off their debt, but they pay it off for less than they might have outside of debt review.

TWO THINGS YOUR DEBT REVIEW DOES FOR YOU

IT’S TAKING TOO LONG! Paying off debt, sadly does not happen overnight (inside or outside of debt review). It is a slow and often painful experience. The debt is real and it is going to take real effort and dedication to get out of debt. Most consumers who use credit will never get out of debt. They will remain caught in a loop using credit from one creditor to pay their other creditor and probably to pay for almost everything else in their life. Consumers in debt review however, are not caught in the same vicious circle. Each month they chip away at their debt without having to take on more debt. Slowly but surely they are getting closer and closer to being totally debt independent. These days, this is the new definition of being “rich”. All of that takes time, it may even feel like it is taking too long. You may be looking at your credit provider statements, or your Payment Distribution Agent and thinking that months or even years have gone by, and your debts are still there, shrinking too slowly. How can you remain motivated during this protracted time?

TWO THINGS YOUR DEBT REVIEW DOES FOR YOU

FOCUS ON THE BENEFITS If you are growing impatient waiting for all your debt to be paid off, and you feel like debt review is not working, then take a moment to contemplate how each month, your debt review is making it possible for you to cover your necessary running costs. This, in itself, is amazing. You are managing to cover your living costs, without having to sell your future to pay off more debt. Even if your debt was not increasing or decrease, this is a fantastic benefit of debt review. These days, everyone is feeling the rising cost of living. You might need to make adjustments to your living situation over time to make the most out of that monthly budget figure, but remember that debt review is enabling your family to have the essentials without having to use more and more credit and getting deeper and deeper into debt. Each month, as you pay your debts, you are not been hit with all the nasty fees and charges that you would otherwise have to pay. Each month, due to amazing concessions on your accounts, you are saving hundreds if not thousands of Rand that you would otherwise have to pay with sky-high interest rates. By remaining focused on the benefits, both short term and long term, you can stay motivated through good times and tough times. So next time you feel that it is taking too long to get out of debt, try to remember that which each monthly payment you are experiencing all the amazing benefits of debt review, and getting another step closer to being free of the burden of debt.

DEBT REVIEW LESSON 2

You must ask your Debt Counsellor which attorneys they suggest you use for your debt restructuring court order application. They will represent you at court.

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WATCH OUT WHEN LOOKING FOR A LOAN A lot has been written about ‘good debt vs. bad debt’ . The message is always that consumers must stay away from bad debt but embrace good debt. Good debt is often defined as debt that is taken on to buy an asset, or make an investment that could potentially, over time, increase your net wealth. A home loan is a great example of good debt, because usually the property value will increase over time. Bad debt is defined as debt that is used to buy things that lose value. Making use of credit cards, or a personal loan to buy clothes or consumables is an example of bad debt. On paper, these definitions make sense, but in reality, especially in our current economic environment, desperate consumers may have no alternative but to incur “bad debt” just to make ends meet. For millions of South African consumers, debt has become part of their everyday lives. Unfortunately, unscrupulous people are exploiting these desperate consumers who are desperately looking for loans. Here are some tips to make sure you don’t get scammed while shopping around for the best loan.

WATCH OUT WHEN LOOKING FOR A LOAN

KNOW YOUR CREDIT PROVIDER The National Credit Act (NCA) defines a ‘credit provider’ as a party who supplies goods or services (in terms of an instalment sale agreement, for example), or who pays money (in terms, for example, of a secured or unsecured money loan, overdraft facility, pawn transaction or mortgage loan). Credit providers and the different credit agreements are regulated by the NCA, which sets out certain requirements that must be complied with. It is very important to note that all credit providers that intend on entering into a credit agreement (as set out in Section 8 of the NCA) with a consumer must be registered with the National Credit Regulator (NCR). The first step for consumers looking for a loan would therefore be to ensure that the credit provider they are dealing with is legitimately registered with the NCR. This can quickly be done by visiting their website at www.ncr.org and searching for the credit provider on the “registered credit providers” page. If a prospective credit provider is not listed then warning lights should be flashing!

WATCH OUT WHEN LOOKING FOR A LOAN

MAKE SURE AN AFFORDABILITY ASSESSMENT HAS BEEN DONE In terms of the NCA, a credit provider must do an affordability assessment with a consumer to make sure that the consumer can actually repay the loan. This means the credit provider must ask for proof of the consumerâ&#x20AC;&#x2122;s income and expenses to figure out if the consumer can really afford the monthly instalment on the loan. Any supposed credit provider that is willing to loan a consumer money without doing an assessment is breaking the NCA and is probably trying to scam the consumer.

WATCH OUT WHEN LOOKING FOR A LOAN

CHECK THE TERMS AND CONDITIONS OF YOUR CREDIT AGREEMENT After the credit provider completes an affordability assessment with a consumer, then they need to send an official quotation to the consumer.

After the credit provider completes an affordability assessment with a consumer, then they need to send an official quotation to the consumer. On the quote the credit provider must list, inter alia, the cost of credit and the interest rate that will apply. These costs and interest rates are regulated by the NCA which set certain limits that may be charged by the credit provider as follows:

Sub Sector

Mortgage Bond

Credit Facilities

Unsecure Loan

Short Term Loan

Maximum Initiation Fee

Maximum Interest Rate

R 5 000.00

(Repo Rate x 2.2) + 5% = 12.7%

R 1 000.00

(Repo Rate x 2.2) + 10% = 17.7%

R 1 000.00

(Repo Rate x 2.2) + 20% = 27.7%

R 1 000.00

5% per month (60% per annum)

* the current Repo Rate is 3.5% but changes from time to time If the credit provider you are talking to charges more than the rates shown in the chart, that is illegal and could be a warning sign that you are walking into a trap.

WATCH OUT WHEN LOOKING FOR A LOAN

NEVER PAY TO GET A LOAN The most important thing to remember when looking for a loan, is to NEVER, EVER pay any money to the credit provider so that you can get money from them. This is not necessarily wrong, but reputable credit providers will (in most loan agreements) add any costs to the overall balance the consumer must repay over time. This means that if a consumer applies for a personal loan of R25 000, and the maximum fee is R1 000 the consumer will receive R25 000 from the credit provider but will owe the credit provider R26 000.00. Attorney Wessel Symington of Steyn Coetzee says: “If the person you are dealing with says that you have to first pay a fee to “release the funds” or pay for some paperwork that has to happen first then you are almost definitely dealing with a scammer”.

WATCH OUT WHEN LOOKING FOR A LOAN

DONâ&#x20AC;&#x2122;T FALL FOR SCAMS Consumers shopping for loans are in most cases pretty desperate to get money to make ends meet. That desperation makes them easy targets for scammers who are preying on the vulnerable. If you are looking for a loan then make sure you are dealing with a legitimate credit provider who follows the requirements of the National Credit Act. If it seems like they are cutting corners and are not asking for needed information or giving you important documents then beware. Above all remember never to pay money in order to get credit. This is the most common scam out there. If you are using credit to pay for credit and really struggling to make ends meet then rather than take on more debt consider making use of processes like debt review to get rid of all your debt. Debtfree Magazine would like to thank Wessel Symington of Steyn Coetzee Attorneys for his assistance with this article.

LESSONS TO TAKE FROM THE CARTE BLANCHE FEATURE ON DEBT REVIEW Recently the well-known TV show, Carte Blanche, did a short feature about some consumers who have had difficulties while in the debt review process. Let’s look at what we can learn from the show.