07 Feb Can You Cancel Debt Review?
So, you’d like to cancel debt review. Unfortunately, cancelling debt review isn’t as easy as it may sound. In fact, the phrase ‘cancel debt review’ does not exist within the debt and legal industry. However, there are different ways to exit debt review, with and without a court order. This post explores the different ways you can exit debt review, as well as assessing whether you’re eligible.
Debt review is an enticing option for those suffering large amounts of debt and would like the opportunity to consolidate into one monthly payment, with the opportunity of gaining lower interest rates, and even negotiating reduced monthly payments with creditors. Cancelling debt review isn’t always possible, but there are ways to exit the process legally and responsibly.
How to exit debt review
It’s important to make the distinction between exiting debt review before and after a court order. There are three paths you can take to exit debt review: voluntary withdrawal, court order rescission, and negotiating with creditors outside debt review.
Voluntary withdrawal
You can only consider voluntary withdrawal before a court order is granted for your debt review application. After the order, completing the process responsibly becomes the primary exit strategy.
Eligibility for voluntary withdrawal from debt review
You can only withdraw before a court order for payment is placed. Otherwise, after it’s placed, debt review becomes the primary exit strategy.
Creditor and debt counsellor approval
Both your creditors and debt counsellor have to agree with your withdrawal request. This involves:
- No form 17.2 acceptance. If your debt counsellor hasn’t yet issued form 17.2 to confirm acceptance of your debt review application.
- Negotiated repayment plans. You must reach a renewed debt repayment program that all parties find acceptable.
- Debt counsellor acceptance. Your debt counsellor must first evaluate your ability to financial circumstances and ability to manage debt on your own effectively.
How to withdraw from debt review before a court order
- Talk to your debt counsellor. It’s crucial to assess the feasibility of your request.
- Negotiate with creditors. Your counsellor will aid in liaison with respective creditors to negotiate new repayment plans directly with your creditors, aiming for terms acceptable to both sides.
- Submit a formal withdrawal request. If everyone agrees, your debt counsellor will submit a formal withdrawal request to the National Credit Regulator (NCR).
- NCR approval. The National Credit Regulator will review the request based on debt counsellor concerns and creditor agreements.
What happens next?
Voluntary withdrawal requires significant effort and negotiation. Success depends on convincing creditors and securing their approval.
You’ll either be approved or denied. Your debt review status is removed from your credit report if you’re approved. You’ll now manage your debts according to the negotiated agreements. If you’re denied, you must continue with the debt review process as laid out in the court order.
Court order rescission
Court order rescission for debt review in South Africa is a highly complex and rarely successful option. It involves applying to the court to cancel an existing court order granting you debt review.
Reasons why a court order for debt review could be rescinded
Legal Errors. Rescission is only possible if there were demonstrable legal errors in the initial debt review application process that led to the court order. For example, incorrect information, procedural mistakes, or even lack of proper notification to affected parties.
Limited Scope. This typically only applies to serious legal mistakes impacting the legitimacy of the court order itself.
To initiate rescission, You need to provide convincing evidence to the court demonstrating the specific legal errors and their impact on the court order.
After a Court Order
It’s even harder to exit debt review after a court order. However, it is possible. Here are some of the ways you can exit debt after a court order.
Completion of Debt Review
Negotiation with Creditors. Depending on your situation, you might negotiate with creditors to settle your debts outside of the debt review process and potentially secure a more favorable agreement. However, this is something you should definitely consult professionals for.
Completion of Debt Review. In actuality, the easiest way to exit debt review is to complete. It’s the most hassle-free medium available, involving paying off one ball of consolidated debt. Once fully paid off and cleared by the debt counsellor, your debt review status will be removed from your credit report.
In conclusion, you can exit the debt review process with help from professionals. Contact Cape Town Legal Consultants today for expert guidance on exiting debt review.