3) Review + Enforcement Flashcards
when can the credit provider terminate the debt review process?
(AND)
1) D is in default with provider
2) 60 business days have passed since consumer first approached counsellor
3) consumer is not waiting for MC hearing to restructure debts
how can the credit provider terminate the debt review process?
1) send a notice to D, counsellor and NCR
2) must wait 10 business days after sending the notice before approaching the court to send a summons to D
3) court can say review must resume thereafter
when can the consumer terminate the debt review process?
once the restructuring order has been granted by the court, and she has paid off all of her s/t debts and has demonstrated ability to pay off existing l/t in the future
how can the consumer terminate the debt review process?
- she can apply for a certificate of clearance from her counsellor and will be able to enter into new agreements
- counsellor will file certificate with bureaux and her negative credit history will be expunged
how can low-income consumers be released from their debt burdens?
debt intervention
who is eligible for debt intervention?
consumers who:
a) earn less than R7500 per month
AND
b) owe less than R50000 in unsecured debt
what happens during the debt intervention process?
consumer goes through a process similar to debt review done by the National Credit Regulator who may refer the cons to the Tribunal
who orders for debt intervention?
the Tribunal
what are the possible outcomes for intervention?
a) cons debts rearranged for repayment within 5yrs (normal restructuring)
b) or, if not possible, intervention (12 month suspension of repayments)
c) possibly financial literacy training
what happens with reassessment in intervention?
- financial position must be reassessed by the NCR after 8 months
- if debts can be successfully rearranged for 5-year-repayment, Tribunal will give restructuring order
- if not, extend intervention period
what happens if intervention is extended?
- financial position must be reassessed by the NCR after a further 8 months
- if debts can be successfully rearranged for 5-year-repayment, Tribunal will give restructuring order
- if not, refer to Tribunal for extinguishment of part/all debts
- Tribunal may prohibit new agreements for 6-12months
where is info about intervention found in NCA?
National Credit Amendment Act 2019
what effect can the Amendment Act have on the market?
- riskier for C to lend to low-inc individuals (financial exclusion)
what happens when the cons defaults/breaches the credit agreement?
a) provider has right to uphold agreement and claim repayment (specific performance)
b) provider may cancel agreement and claim return of goods + damages
what section is the notice for provider enforcement in?
s129(1)(a)
what procedural steps must the provider follow for enforcement?
send her a notice which:
1) draws her attention to the default
2) proposes she approach a debt counsellor / use an alternative NCA dispute resolution method to resolve disputes
3) advise D that should the matter proceed to court, (and C gets a judgement against D) some of D’s assets can be taken and sold to pay the debt
who can be used for alternative dispute resolution?
- ADR agents
- ombudsmen
- consumer court
when may the C approach the court after sending a notice?
- 10 business days after notice is hand-delivered/posted
- must be 20 business days after the consumer has been in default
- after alternative dispute function has failed
what is a summons?
- will be served to D by sheriff of court
- provides them with notice of court hearing and instructs D to appear in court and answer to the case there
effects of C enforcement on debt review?
D may not enter into debt review for that particular agreement that was enforced
what are the delivery requirements for the s129(1)(a) notice?
- sent by registered post, and follow up with PO to track and ensure it was received by D
OR - hand-delivered to an adult at the consumer’s address they stipulated in their agreement
what if consumer fails to collect the notice?
if they are notified that it was delivered and failed to pick it up, it is not a good defense
what is an ombudsman?
independent person who mediates disputes to get them to agree on a negotiated settlement
what is an ADR agent?
an agent which specializes in mediation
what right to compensation does C have?
- under certain circumstances for costs incurred for enforcing the debt
- if court believes they suffered an unreasonable delay or exceptional costs due to the cons’s conduct
eg) intentionally provides false info
