While the provisions made by the National Credit Regulator (NCR) of South Africa make
debt repayments easier, there are things you can do before making use of
debt consolidation and counseling. While the image of creditors, especially unpaid creditors, in your mind is enough to scare you into counseling, honesty pays.
Debt counseling will see a counselor review your debt, then organise with your creditors an easier term of payment and then get this signed off by the creditors. You have to pay him for this service. But before applying for this, why not try to manage your own creditors first. Contact them to inform them that you will be unable to make payment, explaining your predicament. Most creditors lose money when they repossess your assets or collateral, so would rather arrange for the full amount to be repaid than making rash decisions.
Most creditors will help you to make payments on your debt even if this means reconsidering the repayment terms. This could range from giving you a months grace where you don’t pay (but pay one extra month), to paying 70 percent of the repayment instead of the full amount or even renegotiating the payment term to reduce the monthly repayments.
While you will pay more on interest in the long run, by paying a debt over a longer repayment period, you do offer yourself the luxury of a reduced premium right now. Such an arrangement may help you to recover from one month of bad debt before it puts you in the debt trap.