07 Jul Debt Review Timeline: Major Milestones Ahead

Going under Debt Review is not as intimidating as some might think. It is actually a process that empowers over-indebted individuals, and it can help you rebuild your finances. As a legal way to reduce your debt repayments, you can look forward to less stress and uncertainty for your budget. The debt review timeline means major milestones ahead as you work towards repaying your creditors. Let True North Debt assist you in achieving financial freedom!

Knowing how debt review works can help you feel more confident in your decision. Let us consider the steps that await you, by breaking down the debt review timeline and major milestones ahead.

Month 1: Application & Assessment

Your journey begins when you apply for debt review through a registered debt counsellor, like those in our True North Debt team. We will assess your income, expenses, and debts to determine if you’re over-indebted and can qualify for this process. If successful, we will issue you with a Form 17.1, which notifies your creditors. Not sure where you stand? Here are 5 signs you need debt rescue, and what to do about it.

Once you’re officially accepted, the debt review flag will show on your credit report, protecting you from legal action. The debt review flag also stops you from accessing more credit.

Months 2-3: Proposals & Negotiations

Now that you’re under Debt Review, you can look forward to its many benefits. In this stage, your debt counsellor negotiates reduced instalments with your creditors. Creditors have time to accept or reject our proposals before we submit this new plan to the Magistrates’ court, where it becomes a legally binding court order once approved.

During your first 3 months under debt review, you’ll be paying off debt review fees. These won’t cost you anything extra – they are worked into your monthly repayments.

From Month 4: Debt Review in Motion

From this point forward, you will pay a reduced monthly amount towards your debt, based on what you can realistically afford. This consolidated payment is made via a registered Payment Distribution Agency (PDA), which distributes funds to your creditors based on the agreed plan. Debt review is now in motion, and the repayment period typically lasts 3 to 5 years.

During this time, our team are available to provide guidance and support. You must stay consistent with payments as you work towards overcoming your debts. Wondering how much you will be paying each month? Use our FREE DEBT REVIEW CALCULATOR to get an idea.

Final Stage: Debt Clearance Certificate

The final and most rewarding stage of debt review is when you have successfully paid back all your restructured debts. Your debt counsellor will issue a Clearance Certificate (Form 19) within 21 business days of final payment confirmation. This certificate is sent to all credit bureaus to remove the Debt Review flag. In the months that follow, your credit score will begin to improve, and in time you can access credit once more. Become mindful of your credit habits by knowing how to stay financially fit.

Let True North Debt assist you – start here and now, with professionals who care. Contact us to get started.