Life is unpredictable. Retrenchment, illness, or unexpected expenses can make it difficult to keep up with your debt review payments. Understanding what happens if you stop paying — and knowing your options — can help you avoid the worst consequences.
Important: If you are struggling to make your debt review payments, contact your debt counsellor before you miss a payment. There are options available — but only if you communicate early.
The Consequences of Stopping Payments
If you stop making your agreed debt review payments, several things can happen:
The most significant consequence. The court order that protects your assets is based on you making the agreed payments. If you stop, creditors can apply to have you removed from debt review, and your legal protection is withdrawn.
Once legal protection is withdrawn, creditors can resume collection activities: phone calls, letters, legal demands, and court applications. They can pursue garnishee orders, attachments, and repossession.
The reduced interest rates negotiated during debt review are contingent on you making payments. If you are removed from debt review, creditors can reinstate the original (higher) interest rates, plus any penalties and fees.
Without the protection of the consent order, creditors can apply to repossess your car, furniture, and other financed assets. If you have a home loan, the bank can pursue foreclosure.
Defaults will be recorded on your credit profile in addition to the debt review flag. This can severely damage your credit score and make future borrowing extremely difficult.
If you consistently fail to make payments and do not communicate with your debt counsellor, they may terminate your debt review file. This is a last resort, but it does happen.
What to Do If You Can't Pay
The worst thing you can do is nothing. Here are the steps to take if you are struggling:
As soon as you know you will struggle to make a payment, call your debt counsellor. They have dealt with this situation many times and know how to help.
Whether it is retrenchment, illness, or a temporary setback, explain what has happened. Provide documentation if possible (retrenchment letter, medical certificate, etc.).
Your counsellor can negotiate with creditors on your behalf. Options include a temporary payment holiday, reduced payments for a set period, or restructuring the plan to account for your new income level.
Once your situation improves, resume your full payments. If your income has permanently changed, your counsellor can propose a new restructured plan to the court.
Can I Re-enter Debt Review?
If you have been removed from debt review, you may be able to re-apply. However, this is not always straightforward. Creditors may be less willing to negotiate the second time, and the court may scrutinise the application more closely.
This is why it is always better to communicate with your debt counsellor and try to maintain your existing debt review plan rather than abandoning it and trying to start over.
Prevention Is Better Than Cure
The best way to avoid these consequences is to:
- Set up a debit order so payments happen automatically every month
- Build a small emergency fund — even R500–R1,000 can help cover a missed payment
- Communicate early — your debt counsellor cannot help if they do not know there is a problem
- Review your budget regularly — if your expenses have changed, tell your counsellor so they can adjust the plan
Frequently Asked Questions
Can I pause my debt review payments temporarily?
In certain circumstances, such as retrenchment or a medical emergency, your debt counsellor can negotiate a temporary payment holiday with your creditors. This is not automatic — it must be arranged through your counsellor. Contact them as soon as you know you will struggle to make a payment.
Can I be removed from debt review if I stop paying?
Yes. If you consistently fail to make payments, your debt counsellor may terminate your debt review. Alternatively, a creditor can apply to court to have you removed from debt review (Form 17.2). Once removed, all your original debt obligations resume at the original interest rates.
What if I lost my job — can I still stay under debt review?
Yes, but your circumstances will need to be reassessed. Contact your debt counsellor immediately. They can approach creditors to request a temporary payment reduction or holiday. If you find new employment, your plan can be adjusted to match your new income.
