Knowing what happens after debt review is as important as completing the programme.

Being under debt review can feel like a lifetime. After completing the programme there are so many questions that race through your mind. We invited debt experts to help you answer those questions.

What happens after debt review?

Once you have successfully completed your programme, a debt counsellor will give you a Clearance Certificate also known as Form 19.

According to Carla Oberholzer, debt advisor from DebtSafe, the Clearance Certificate can only be issued when:

  • your accounts listed under debt review have been settled.
  • you can carry on with the original agreements you have with your creditors.
  • all your accounts are paid up, except for a home loan. A home loan must be paid up to date as per the debt review agreement.

The debt counsellor will then send your Clearance Certificate to your creditors and the credit bureaus.  The National Credit Act requires the bureaus to remove all the negative listings from your record – leaving you with a clear credit profile.

Can you immediately take up debt again?

“Unfortunately, credit providers cannot assist a customer who has come out of debt review directly,” says Mellony Ramalho, group executive for the sales and branch network at African Bank.

Ramalho says you must start building your credit score (see the infographic for tips on how to fix your credit score) before borrowing from creditors again.

Oberholzer advises that you check your credit record one month after receiving your Clearance Certificate to see if everything is in order.  If it’s not, ask your debt counsellor to sort it out for you.

She advises that you refrain from applying for credit before checking. If your application is declined because of your credit record it could affect your credit score negatively.

If you find you have an unhealthy credit profile, investigate the reasons listed.

A big part of fixing your credit profile is determining what caused it to go bad in the first place. Was it one dramatic incident, like a foreclosure or bankruptcy? Or was the problem a series of smaller things, like late and missed payments that went on for a period?

Note that it is not only a poor credit history that may affect your ability to get credit. A lack of positive credit information can cause your application to be declined or can result in an increased cost of credit.

One thing you must remember is that debt review is there to get you back on your feet financially, and that includes leaving you with a clear credit record.

0001 (19)

This article has been prepared for information purposes only and it does not constitute legal, financial, or medical advice. The publication, journalist, and companies or individuals providing commentary cannot be held liable in any way. Readers are advised to seek legal, financial, or medical advice where appropriate.