As a person affected by debt, opting for debt review can be a wise decision to get relief from debt traps. Debt review contracts are designed to provide financial solutions to individuals who are drowning in debt. However, there may come a time when you need to terminate your debt review contract due to various reasons, such as change in financial situation or completion of the debt review process. This article outlines the steps to follow when terminating a debt review contract.
1. Understand the terms of your contract
Before terminating your debt review contract, it`s essential to understand the terms and conditions outlined in the agreement. Familiarize yourself with the clauses that pertain to early termination and any fees or penalties that may apply. Knowing the terms of your contract will help you prepare adequately for the termination process and avoid any unintended consequences.
2. Notify your debt counsellor
Once you have decided to terminate your debt review contract, the first step is to inform your debt counsellor. Your debt counsellor is your primary contact throughout the debt review process. They will guide you through the process and advise you if there are any alternatives to termination, such as debt consolidation or an alternative repayment plan.
3. Request a clearance certificate
A clearance certificate is a legal document provided by your debt counsellor after you have fully paid all your debts. The certificate is filed with the National Credit Regulator, and it confirms that you are no longer under debt review. Once you have requested a clearance certificate, your debt counsellor will assess your account to ensure all outstanding debts have been settled. If all debts have been settled, your debt counsellor will issue a clearance certificate to you.
4. Notify all creditors
After receiving your clearance certificate, it`s essential to notify all your creditors of the termination of your debt review contract. Inform them that you are no longer under debt review and provide them with a copy of your clearance certificate as proof. This will ensure that they update your credit records and remove any negative information that may have been reported.
5. Monitor your credit report
After terminating your debt review contract, monitor your credit report to ensure all negative information has been removed. You can access your credit report from any of the credit bureaus in South Africa, such as Experian or TransUnion. Your credit report will show whether your record has been updated to reflect the termination of your debt review contract.
In conclusion, terminating a debt review contract requires careful consideration and preparation. It`s essential to understand the terms of your contract, notify your debt counsellor, request a clearance certificate, notify all creditors, and monitor your credit report. By following these steps, you can successfully terminate your debt review contract and move towards financial freedom.