When you apply for debt review and debt restructuring, the Debt Counsellor lets the NCR know you have started the process and they, in turn, notify the credit bureaus (via a computer system).
During the time you are in debt review, credit bureaus will put a small indicator in place (often called a flag) to tell credit providers that you are getting rid of your debt, not taking on more debt.
‘During the time you are in debt review, credit bureaus will put a small indicator in place …to tell credit providers that you are getting rid of your debt’
Credit providers will not be quick to offer you credit, as this could be seen as ‘reckless’, which is illegal, and can land them in hot water with the National Credit Regular (NCR) and even facing fines of R1 million and hurt the value of their shares.
So, in many ways, your credit score doesn’t matter while you are in debt review. It will, however, be something that you may want to improve after you finish debt review, if you are thinking of using credit again in the future.
Debt Counsellor Roger Brown, points to this reality when he says: “it doesn’t matter…until it does”.
