Facing The Music

In Credit Repair of CreditGuru (December 15, 2012 2:47 am)

Debt collectors breathing down your neck ?? Are you over indebted? If your answer is yes and it seems that you cannot make a payment then you have to consider debt counselling to immediately solve the problem. Debt counselling is a counselling service provided by a debt counsellor. The debt counsellor helps you to get lower monthly mortgage payment by negotiating your monthly payment with your creditor.

Debt Counselling

Basically, the law in South Africa gives you legal right to use service from a debt counsellor when you are over indebted. The first step your counsellor undertakes is to establish whether you are over indebted by assessing your current financial situation. You are considered over indebted if you cannot pay your monthly mortgage payment and even it is difficult for you to afford your living needs.

Information provided to your counsellor will form the foundation of negotiations, therefore it is advisable to provide information that is accurate. If established that you are in fact over indebted, your counsellor will advise your creditor about your current financial position. You are likely to receive a lower mortgage payment suited to your financial capabilities if your counsellor manages to assure your creditor.

Debt counselling service is not a free service but you do not have to worry because you are not required to make an upfront payment. The fee for your debt counsellor is included in your new monthly mortgage payment. In most cases, South African debt counsellors will charge fees exclusively if negotiations have been won, meaning their client received a new morgage payment plan.

The debt counsellor usually receives your first monthly payment under the new plan as compensation for services rendered. Related legal fees occurring in the process is usually paid with your second monthly payment.

Your third monthly payment is the first of which your creditor receives. Under the new plan, your payments go to your creditor via the Payment Distribution Agency.

This agency will distribute payment from you to pay your debt counsellor, attorney and definitely your creditor. Therefore, if there is a debt counsellor that requires you to pay directly to him if you get your new payment plan, it is advisable to leave such as a debt counsellor.

Since you get a lower monthly payment then the consequence is that your loan term will be extended. To illustrate, you might receive a new loan term of 30 years instead of 15, depending on several relevant factors reflecting your current financial position.

Experienced debt counsellors are naturally most efficient.

Visit http://debtreviewloans.co.za for more info.

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