7 signs your debt is out of control

Did you know that in 2020 over 10 million South Africans either missed a debt payment, paid late or defaulted on a debt? That’s a lot – so it’s no surprise that more people are seeking help to manage their debts, according to DebtBusters’ latest Debt Index. Seeking help is a good thing – it means you are on the road to taking control of your finances. So, if you recognise some of the troublesome signs below, and are concerned about your debt situation, take action!

Spot the problem, and take action

Recognising you may have too much debt is the first step to taking control of it. We chatted to Amelia de Milander, DebtBusters’ Marketing Manager, and Lee Soobrathi, Head of Case Management at the Office of the Credit Ombud, to help you identify the signs your debt may be out of control.

Seven signs your debt is out of control

What are your options?

Debt review
Debt review, or debt counselling, is a legal process you can enter if you are struggling to pay your debts. A debt counsellor will determine how much you can afford to pay each month towards your debts and will negotiate lower monthly payments with your creditors so that you can pay off your debts and still pay your living expenses. When you are in debt review your creditors cannot take any legal action against you or harass you for payment. Always be proactive in managing your debt because if your creditors have taken legal action, you may not qualify for debt review.

Debt consolidation
This is when all your debts are consolidated into one debt. Although this makes managing your debt easier because there is just one loan, debt consolidation doesn’t always mean you will pay less per month in total. That will depend on the interest rate you are charged, and whether any creditors agree to lower monthly payments. Always check the details of a loan thoroughly and do the calculations so you know whether consolidating your debt is cheaper than paying each debt off individually.

Tips from the experts

We can help!

Don’t ignore the warning signs. Take charge of your debt. Apply today for debt management and counselling services from Truth About Money.

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