If you have debt problems or...                                

You are struggling to pay your accounts each month.

Maybe you are barely making it through the month or not making it at all or...

Maybe debt collectors are already hounding you and they can be a pain or...

You are worried that your wages or salary might be garnished.

What should you do?

There are a number of options that you can pursue. And I want to show you the different options available to you so that it can help you to make the right decision for you.



Application is made in the Magistrate Court. To qualify for Administration, the maximum debt you need is R50,000. Your debt will continue to accrue interest and costs. No more debt may be made. The repayment amount is to be deducted from your salary. An Administrator is appointed, usually an attorney and his/her running costs must be covered out of the monthly contribution thus making it more difficult to finalize quickly. The additional costs and the interest that accrues may cause the process to take years to settle your debt.



One common approach that people try when they are over-indebted involves taking out a loan. How does debt consolidation work when a loan is involved? Essentially, you take a sizable loan, use those funds to pay off all your creditors, and then make monthly payments on the loan. The loan can be acquired from a bank

Although this approach has the basic appeal of consolidating your debt into one monthly payment, there are significant costs and risks involved:

  • The interest rate on a debt consolidation loan is likely to be high. The rate may be lower if you are using a home equity loan for this purpose, but if you take that approach, you'll potentially be jeopardizing your home ownership if you fall behind on your loan payments.
  • With this approach to consolidation, the credit cards and store cards that you pay off with the loan will remain open. This raises the very real possibility of running up new debt on those cards, on top of your consolidation loan debt.
  • Consolidation loans are too much in the vein of "robbing Peter to pay Paul". All that you would have done, is shifted your debt, but you have not really done anything to address the underlying problem.
  • A consolidation loan will definitely increase your debt load. For instance, you may have R200 000 worth of debt now. In order to settle this, you will end up with a new consolidation debt of about R330 000. Which means a higher monthly payment than you currently have and a longer period to pay it off. Where is the sense in that? All you would have done is create more debt to pay your existing debt.
  • Such a Consolidation Loan may offer you temporary relief but believe me, it will catch up with you after a few months of paying that larger loan. We see it regularly - people take loans to settle their debt and then a few months down line they are in a worse situation. Having the money now is fine, but when you have spent it, you must pay it back.
  • To qualify for a consolidation loan your credit record must be clean. No adverse credit bureau listings, no skipped payments, no over-indebtedness etc



An application for sequestration is brought to Court in order to surrender your estate (Assets and Liabilities) to creditors under the control of the Master of the High Court and to declare you insolvent or bankrupt. You will have to pay a substantial fee to have an attorney represent you and apply for your sequestration order.

If it is granted by the court, the Master will appoint a Trustee to administer your estate, and he must dispose of your assets according to the Insolvency Laws of South Africa and distribute the proceeds thereof to your creditors after the administrative costs have been settled.

This will affect your life for several years and the stigma will probably remain with you for the rest of your life. During your insolvency period, you will not be creditworthy. You may not have a cheque account or a credit card facility. You may under no circumstances engage in any debt arrangements. Since it is a High Court matter the costs are astronomical and must be paid out of the sequestration, or upfront. It can be more than R30 000 depending on the size of the insolvent estate. Also, you must prove that there is a benefit for your creditors, which is difficult for most people without any solid assets. You also have to prove that you are indeed insolvent and not just experiencing cash flow problems. Then there are unscrupulous liquidators who also demand their pound of flesh. Lastly, if you want to apply for rehabilitation thereafter, it entails a further court application in Court, with added costs, unless you remain thereunder for an extended period.

Whilst sequestrated, you may not be a director of a company without approval from your appointed Trustee.

For someone who is already battling to pay their debt, where do they find that money?

Solvency Test – This is done to determine if your debt is greater than your Assets (things that you own).

However, if your essential living expenses and your debt is greater than your income, and you have no assets that can be sold, you will only get into more trouble as the debt trap in which you are in may begin to spiral out of control.

Voluntary Sequestration might be an option to consider, but you won’t get off scot-free as you will have to pay towards the debt from your income which will be determined by the Master and/or Trustee.



Many Debt Review adverts do not specifically state that they are advertising debt review. They often use terms such as Debt Management, Debt Consolidation etc and even sometimes even Debt Consolidation Loans to seemingly coerce consumers to sign up with them. You may only discover later that it is Debt Review that you were placed under when in fact, you might have been thinking it was something else.

So always make sure that you know what you are getting into.

Application for debt review is also made in the Magistrate Court. You must eventually pay the total debt outstanding, plus all costs and interest. This could take you years. 

You may not acquire any further credit whilst under debt review. 

Your creditors may under certain circumstances, withdraw from the debt counselling process after 60 business days from the date on which you applied for debt counselling and can proceed with legal action against you. 

Let us not forget to mention that Debt Review affects your ITC record and therefore your creditworthiness.  It can also have an influence on future job applications and even renting a home for you and your family.

For more information on the effects of Debt Review visit Hellopeter.com and read what people who have been there have to say. It is the experience and opinion of the public.

  1. Do you really want to be locked in for years by a court order? 
  2. Do you want to be possibly prevented from renting a home for yourself and your family? 
  3. Do you want to be placed in a position, where finding a job can be difficult due to the debt review? 
  4. Do you want to be in a position where you may not acquire credit again for years whilst under debt review? 

The law states

  • whilst under debt review you are not allowed any more credit,
  • you may not cancel the debt review, (except in special circumstances) and
  • your name will remain listed on the credit bureaus as such until all the debt has been paid.

Once In, Locked In.

The only way to get out of Debt review is

  • Pay up all your debt,
  • Appoint an attorney to apply to the courts to prove that you are no longer over-indebted and to rescind the debt review order.

Be wary of advertisers promising you that they can get you out of debt review.

I am not sure how they do it, or if they can do it. But I do know that they charge a hefty fee and often seem to disappear thereafter.

So be warned. Just because someone says they can get you out of debt review, does not mean that they can.


In all three instances above (Sequestration, Administration and Debt Review) the process includes Court orders which are reflected at the Credit Bureaus and that is why you cannot get further credit. Creditors and employers often draw ITC reports, and they pick up these court orders that have been filed against you.


And lastly.



We believe OUR DEBT MANAGEMENT PROGRAMME offers a better and positive alternative to Debt Review and Administration. We do not take your last cent. In fact, we make sure that you come first and then only your creditors. Unlike the other options, the Debt Management Program has an achievable effect on your credit score and will not cause long-lasting negative listings. Our DEBT MANAGEMENT PROGRAM PLAN is available to everyone who qualifies. When you use our service, you will be assisted by an experienced team that have more than 15 years’ experience and who will negotiate directly with your creditors, on your behalf. We deal with your creditors so that you do not have to contact them. During the entire process, you will be protected from their harassing phone calls, repetitive emails, unwelcome visits, and other unpleasant debt collecting tactics that they use to force you to pay. We do not promise that you can start today and be debt-free tomorrow, or that you do not need to pay your debt. But we do promise that if you stick with us, you will be debt-free quicker than with any other method. That is a fact!

We have been doing this for many years, helping thousands of clients achieve their goals of becoming debt-free. This means that we have been very successful at it. And so, can you be.

Benefits Of Our Debt Management Programme:

  • No Debt Review
  • No Sequestration
  • No Administration
  • No Garnishees and No Judgements (save for if you are or have been summonsed for a debt)
  • No Court Orders Hampering Your Life For Years
  • No fixed Term Contracts
  • No Upfront Fees
  • Stop Your Creditors harassing You
  • One Monthly Payment That You Can Afford
  • No Credit Checks
  • We handle all the legal issues if any exist or arise
  • We take all the calls and correspondence from debt collectors
  • We have strong legal backing to support you when necessary


If You Would Like To Find Out How We Can Help You, Send Us Your Details And We Will Call You Back - Absolutely Obligation-Free.