Author - Lauren Heekes
Would you like to see some Debt Review installment examples to understand how Debt Review reduces debt. Here are 3 client examples. See what these clients are paying now.
Steven's Debt Review Installment
Steven's income was affected by an unforeseen medical bill that resulted in his debt commitements not being met for almost 6 months. When he approached us he wanted to know how Debt Review would reduce his monthly repayments and also how the process works.
The above installment and interest rate was calculated for Steven
Stevens Current Situation:
Steven's current combined contractual agreement is R13,922.77 per month at an average interest rate of 30% over 12 months.
This installment reduces over the 12 months as smaller debt is settled.
Interest paid back to his Credit Providers = R12,439.87
Stevens New Debt Review Contract:
Steven's installment was reduced to R1,831.53 at an average interest rate of 6.5% over 48 months.
Interest paid back to his Credit Providers = R10,130.70
The following Fees were added onto the above Restructured Installment:
Debt Counsellors Fees = R100.00 per month to manage Steven’s Debt Review Process.
PDA Fees = R70.00 This is what is charged to pay the installment to Credit Providers.
For a detailed explanation of how fees work, please read the article below “Debt Counselling Fees Explained.”
Term of Debt Review:
You will note that some of the terms are longer than 48 months. However one of the biggest benefits of Debt Review is that as short term loans are settled, the installments rollover to other debt which reduces the overall term of the Debt Review process.
Shortly after Steven started Debt Review his income increased and he was able to pay R4,000.00 each month to his Debt Review Installment. This resulted in Steven finishing his Debt Review in 24 months and not 48 months as previously calculated. Steven's Debt Review status was removed 2 months after completing the process and he was credit worthy again.
Steven will therefore only paid back R5061.77 in interest charges to Credit Providers.
Send Your Questions to Negociate Credit Solutions at email contactme@negociate.co.za or get additional contact information below for online assessments, facebook messenger or submit a "Call back Request"
Aneke's Debt Review Installment
Aneke approached us as she could not longer afford her installments each month. Her parents had moved in with her after their business was liquidated and they had no income at that point. Aneke was looking after her parents and this resulted in her over indebtedness.
The above installment and interest rate was calculated for Aneke
Aneke's Current Situation:
Aneke's current combined contractual agreement is R18,742.28 per month at an average interest rate of 23.50% over 21 months.
If however she reduced the installment, as smaller debt was settled, then the term would be longer and the interest rate more.
Interest paid back to her Credit Providers = R70,951.32
Aneke's New Debt Review Contract:
Aneke's installment was reduced to R6,940.21 at an interest rate of 5,05% over 55 months.
Interest paid back to her Credit Providers = R37,386.79
The following Fees were added onto the above Restructured Installment:
Debt Counsellors Fees = R353.00 per month to manage Aneke’s Debt Review Process.
PDA Fees = R120.00 This is what is charged to pay the installment to credit providers.
For a detailed explanation of how fees work, please read the article below “Debt Counselling Fees Explained.”
Term of Debt Review:
You will note that some of the terms are longer than 55 months. However one of the biggest benefits of Debt Review is that as short term debts are settled, their installments rollover to other debt reducing the overall term of the Debt Review process.
Within the first 6 months of Debt Review, Aneke decided to do an extra job on the weekends and so she was able to pay R9,200.00 per month. She completed Debt Review in 42 months and was credit worthy 3 months after she completed the process.
Aneke will therefore only paid back R28,799.04 in interest charges to Credit Providers.
Send Your Questions to Negociate Credit Solutions at email contactme@negociate.co.za or get additional contact information below for online assessments, facebook messenger or submit a "Call back Request"
Mokgadi's Debt Review Installment
Mokgadi and her husband separated and so her family's overall income was reduced. She could no longer afford the combined installment she had to pay for her unsecured debt, vehicle and Home Loan. She was concerned that legal action would commence on her home and vehicle as she was 3 months in arrears. She was married Out of Community of property and could therefore apply for Debt Review without her husband.
The above installment and interest rate was calculated for Mokgadi
Mokgadi's Current Situation:
Mokgadi's current combined contractual agreement is R31,207.27 per month at an average interest rate of 18% over 23 months.
This installment includes her Home Loan Installment however the term excludes the Home Loan term. The Home Loan installment will continue to be paid after debt and vehicle are settled.
The above term of 23 months applies if she does not reduce her installment over the term. If she does reduce her installment after her unsecured debt is settled then the term will be extended until the vehicle is settled..
Interest paid back to her Credit Providers for unsecured debt 20 months = R55,233.92
Interest paid back for her Vehicle FInance over 53 = R51,065.80
Mokgadi's New Debt Review Contract:
Mokgadi's installment was reduced to R16,243.00 at an interest rate of 7.37% over 55 months. This installment included her home loan installment.
After 55 months her Home Loan is released from Debt Review and she will go back to paying the original contractual installment until her Home Loan is settled.
The following Fees were added onto the above Restructured Installment:
Debt Counsellors Fees = R450.00 per month to manage Mokgadi's Debt Review Process.
PDA Fees = R135.00 This is what is charged to pay the installment to Credit Providers.
For a detailed explanation of how fees work, please read the article below “Debt Counselling Fees Explained.”
Term of Debt Review:
You will note that some of the terms are longer than 55 months. However one of the biggest benefits of Debt Review is that as short term debts are settled, their installments rollover to other debt reducing the overall term of the Debt Review process.
Mokgadi's Clearance Certificate will be issued once all her unsecured debt and vehicle is settled. i.e after 55 months The Home Loan is also cleared from Debt Review. The installment for the Home Loan will return to the original contractual installment until the home loan is settled.
Send Your Questions to Negociate Credit Solutions at email contactme@negociate.co.za or get additional contact information below for online assessments, facebook messenger or submit a "Call back Request"
There is no quick fix to getting out of debt. Make sure that you partner with a Debt Counsellor that is going to assist you to get out of debt
.
If you would like us to conduct a free financial assessment for you here are contact options:
1.Complete our online assessment form at http://bit.ly/39miXXx
2. Send us an email to contactme@negociate.co.za
3. Submit your query via our FaceBook Messenger app https://bit.ly/3i3PIwl
4. Complete a call back request on our website at http://bit.ly/38Aoyuc
A consultant will contact you to discuss the way forward. Please note that you are not obligated to proceed if you feel that the solution we offer you will not assist you enough financially.
If you find this article helpful, “Like” our FaceBook page and join our FaceBook Community. Send us a question in messenger and get some free advice on how to resolve any financial issues .
About our Author
Lauren is a registered member of the National Credit Regulator. Prior to that, she worked as a Financial and Technical consultant for McGregor-BFA (Now INET-BFA). McGregor-BFA provided Trading and Market related data as well as Investment management software to Asset Managers, University Business Schools and Investment entities. Thereafter experience was advanced to the Property Market working as a Project Manager for Propertyi. But it was her career at the IEB in Adult Education that inspired a passion of hers to educate consumers about responsible ways of managing their financial lives and the long term advantages of doing so. It is her belief that financial education should be taught from an early age. By doing so we can create a country that is economically stable, driven not only by work ethics, but by becoming Financially Independent too.
