A sound benefit of debt review (debt counselling) is that it can ensure that your assets are protected from credit providers, meaning that no legal action can be taken against you while under protection. However, the disadvantage of this is that you won’t be able to apply for any further credit while under debt review.
Additionally, if you happen to have enough cash to buy a car or house upfront, without applying for finance, that cash will be disclosed to the debt counsellor and used to pay all existing debt. The only way to exit the review would be to settle all outstanding debts, except for house and car financing.
The Consequences of Debt Review
A debt counsellor will put your finances under scrutiny, forcing you to take a look at how you can cut back on your monthly spending to enable you to make debt repayment. While your debt will be negotiated and your monthly instalments reduced, this comes at a cost, which generally means longer repayment terms and additional interest. While under formal debt review a buyer will be unable to apply for access to further debt, which includes finance loans.
Solving the Debt Problem
Debt review requires that all outstanding debt be settled before further debt is entered into. As a result, settling your debt as quick as possible should be your first priority. When under debt review, it is important to discuss any changes to your monthly expenses with your debt counsellor as this may contribute to an updated payment proposal.
Fortunately there are a few organisations that are able to supply finance to people undergoing debt review. At Blacklisted Car Finance we don’t need a review of your current debt, nor do you need a loan from a dealership or bank to gain access to a new car. If you meet our minimum criteria (R12 000 gross monthly income and a deposit of R15 000 or more) then you will be able to rent to buy an approved car of your choice. When the rental period is over then the vehicle you rented will fall under your ownership.