What Debts Can Be Included in Debt Review in South Africa?
Debt review is a legal process designed to help South Africans who are struggling to meet their monthly debt obligations. Introduced under the National Credit Act, debt review allows consumers to restructure their debt repayments into a more manageable monthly plan while protecting them from legal action by credit providers.
For many individuals facing financial pressure, debt review provides a structured path toward regaining financial stability. However, one of the most common questions people ask before applying is: Which debts can actually be included in debt review?
Understanding what debts qualify is essential for anyone considering this process.
Understanding Debt Review in South Africa
Debt review is a formal process managed by a registered debt counsellor who evaluates your financial situation and negotiates new repayment terms with your creditors.
The goal of debt review is to:
- reduce monthly repayment amounts
- consolidate debt payments into a single monthly instalment
- prevent legal action from creditors
- create a sustainable repayment plan
The process is regulated by the National Credit Regulator, which ensures that debt counsellors follow strict legal guidelines.
Not all financial obligations qualify for debt review, but most credit-related debts can be included.
Debts That Can Be Included in Debt Review
In general, most debts covered under the National Credit Act can be included in debt review. These debts typically involve credit agreements between consumers and registered lenders.
Below are the most common types.
Personal Loans
Personal loans are one of the most common debts included in debt review.
These loans are typically used for:
- unexpected expenses
- home improvements
- medical costs
- consolidation of other debts
If monthly repayments on a personal loan become difficult to manage, the loan can be restructured through debt review to reduce the monthly payment and extend the repayment period.
Credit Cards
Credit card debt often carries high interest rates and can quickly grow if balances are not paid off regularly.
Debt review allows credit card balances to be included in the repayment plan, helping consumers manage this type of debt in a structured way.
A debt counsellor may negotiate:
- reduced interest rates
- extended repayment terms
- lower monthly instalments
Retail Store Accounts
Many South Africans rely on retail store accounts for clothing, furniture, and appliances.
These accounts often come with high interest rates and monthly fees. Common retail credit agreements can be included in debt review, allowing them to form part of a consolidated repayment plan.
Vehicle Finance
Car finance agreements can usually be included in debt review if the consumer wishes to keep the vehicle.
The debt counsellor may negotiate with the credit provider to adjust the repayment terms so that the instalment fits within the consumer’s revised budget.
However, consumers must continue paying their vehicle instalments as agreed under the new repayment plan to avoid repossession.
Home Loans (Mortgages)
Home loans are among the largest debts consumers have, and they can be included in debt review in many cases.
Debt review may help by:
- restructuring payment schedules
- allowing consumers to prioritise their home loan
- negotiating manageable repayment plans
Protecting a home is often a priority during the debt review process.
Overdraft Facilities
Bank overdrafts are also credit agreements and can therefore be included in debt review.
Since overdrafts typically carry high interest rates, including them in a structured repayment plan can help reduce financial pressure.
Short-Term Loans and Payday Loans
Short-term loans, often referred to as payday loans, are also considered credit agreements.
These debts can be included in debt review and consolidated into the overall repayment structure.
This can help prevent consumers from becoming trapped in a cycle of high-interest short-term borrowing.
Debts That Cannot Be Included in Debt Review
While debt review covers most credit agreements, some financial obligations cannot be included.
These generally fall outside the scope of the National Credit Act.
Examples include:
Municipal Accounts
Utility bills such as:
- electricity
- water
- municipal rates
cannot be included in debt review.
Consumers must continue paying these expenses separately.
Taxes
Outstanding tax obligations to the South African Revenue Service cannot be included in debt review.
Tax debt must be resolved directly with SARS.
School Fees
Education-related costs are not considered credit agreements and therefore cannot be included in debt review.
Informal Loans
Money borrowed from friends or family typically does not fall under the National Credit Act and cannot be formally included in debt review.
What Happens to Your Debts During Debt Review?
Once a consumer enters debt review, several important things happen.
A Debt Assessment Is Conducted
The debt counsellor evaluates:
- income
- living expenses
- total debt obligations
This helps determine whether the consumer is over-indebted.
A New Repayment Plan Is Created
The debt counsellor proposes a new repayment plan that restructures debt payments to fit the consumer’s financial situation.
This proposal is presented to creditors.
Legal Protection May Apply
Once the process is confirmed by a court or tribunal, consumers receive protection from legal action related to the included debts.
This means creditors cannot:
- issue judgments
- repossess assets without court approval
- pursue legal collections outside the process
Benefits of Including Debts in Debt Review
Debt review offers several advantages for consumers facing financial difficulties.
Lower Monthly Payments
Restructuring debt allows consumers to make manageable payments.
Protection from Legal Action
Creditors must follow the debt review process rather than pursuing immediate legal action.
Structured Debt Repayment
Consumers receive a clear plan to repay their debts over time.
Financial Recovery
The process allows individuals to stabilise their finances and eventually exit debt review once all obligations are settled.
When Should You Consider Debt Review?
Debt review may be worth considering if:
- you struggle to pay monthly instalments
- creditors are contacting you frequently
- your debts are growing faster than you can repay them
- you are falling behind on multiple credit accounts
Seeking advice from a registered debt counsellor can help determine whether this option is suitable for your situation.
Final Thoughts
Debt review provides a structured solution for South Africans facing financial pressure. By including qualifying debts such as personal loans, credit cards, retail accounts, vehicle finance, and home loans, consumers can consolidate their repayments into a manageable plan.
While certain obligations like taxes, municipal accounts, and school fees cannot be included, debt review still covers the majority of consumer credit agreements.
With guidance from a registered debt counsellor and oversight from the National Credit Regulator, the process offers a clear path toward financial stability and long-term recovery.
For individuals feeling overwhelmed by debt, understanding which debts can be included in debt review is often the first step toward regaining financial control.
Frequently Asked Questions
Can credit card debt be included in debt review?
Yes. Credit card balances are considered credit agreements and can be included in a debt review repayment plan.
Can a home loan be included in debt review?
Yes, in many cases a home loan can be included. The repayment terms may be restructured to make the instalments more manageable.
Are retail store accounts included in debt review?
Yes. Most retail accounts that involve credit agreements can be included in debt review.
Can municipal bills be included in debt review?
No. Municipal accounts such as water, electricity, and rates cannot be included because they are not credit agreements.
Who regulates debt counselling in South Africa?
Debt counselling is regulated by the National Credit Regulator under the National Credit Act.
