Can you withdraw from debt review?
We sometimes get requests from clients to withdraw from the debt review process. Withdrawing from debt review is not a simple matter as the National Credit Act does not make provision for it.
Here’s what the Act says on the matter of withdrawal:
- A debt counsellor does not have the power to terminate any debt review. The consumer can also not voluntarily withdraw from debt review and the debt counsellor may not cancel the debt review for his or her client.
- Once a consumer has been accepted for debt review, the process can only be terminated in one of two ways:
a. When all the debt has been repaid and the debt counsellor issues a clearance certificate.
b. When the consumer applies to the court to have the existing court order rescinded. - A client may transfer to another debt counsellor but the payment time line does not start afresh, but continues as was originally negotiated.
If you are under pressure to keep up with your debt review payments, keep in mind that you cannot simply withdraw from debt review as defaulting on a payment will automatically terminate the debt review process; you will then also no longer enjoy protection from your creditors. In addition, the debt review process cannot be re-instituted after such a default.