Beware of Debt Counselling Scams!
Make sure your debt counsellor is accredited and reliable.
We are unfortunately living in a world where crime and greed are abundant. The financial industry is probably one of the most targeted industries out there. Just like your bank gives you guidelines on how to keep your money safe and secure at all times, we also want you to be save when choosing a trustworthy debt counsellor. In this article we go through the most important parts of making sure you do not become another statistic, when it comes to some of the debt counselling scams out there.
1. Find an NCR Registered Debt Counsellor.
The first thing you need to be aware of when choosing or speaking to a debt counsellor is:
The Debt Counselling Industry is regulated and controlled by the National Credit Regulator (NCR). Every Debt counsellor needs to be registered with the NCR.
Make sure to ask your debt counsellor for his/her NCR number. You can then check and verify whether they are registered with the NCR by going to the official website. www.ncr.org.za
You can also request a copy of their NCR Certificate. If they don’t supply you with it or you can’t seem to find them on the NCR website. Immediately stop communicating with them and report them to the NCR. The NCR will then follow through and take appropriate steps to shut them down.
2. Pay your Monthly Installments only to an NCR approved Payment Distribution Agent.
The National Credit Regulator makes provision within the debt counselling process to help protect you from debt counselling scammers how try to use the process for criminal intentions. This is where registered PDA’s(Payment Distribution Agent) comes in.
It is important to verify the bank account owner into which you will be paying your monthly installments into. Your bank will be able to confirm the account holders registered name. Most banks already have all the registered PDA’s as a registered beneficiary.
To safeguard the consumer, the NCR has assigned specific Payment Distribution Agents (PDA) that will receive and distribute your monthly installments accordingly. Therefore your debt counsellor will never ask you to make a payment directly to them.
Your monthly payment will include the debt counsellor’s fees as well as relevant legal fees and aftercare fees. Every thing will be payed accordingly by the PDA that your debt counsellor works with.
Currently there are only three NCR recognized PDA’s.
These agencies are:
3. Do a Google Search on the Debt Counselling Company.
The good thing about today’s technology is that we have the internet at our disposal.
Make use of it by doing a quick search for the debt counsellor you are interested. Visit their website, check out online reviews and gather as much information about your debt counsellor as possible.
Should you still be uncertain about your debt counsellor. Simply go the NCR website, search for your debt counsellor’s name on their database and see if they have a registered listing. You can find their NCR DC number, how long they have been registered and their registered address and contact details.
If you can’t verify and match the information that you were given to the accredited Debt Counselling Company, the chances are good that you have been contacted by someone that is trying to scam you out of your hard-earned money.
4. Read through all documents before signing
Standard procedure with all debt counsellors is to explain the key points of the debt counselling process. Answering any questions that you may have at the time.
The next step would be to get your consent further assist you and then eventually start the process of applying for debt counselling. The documentation you will receive, will contain important information relating to the legal implications of going under debt counselling and documents you need to sign in order for your debt counsellor to process with placing you under debt counselling.
If you are still unsure about certain legal points and your debt counsellor cannot explain it to your satisfaction, then get legal advice or contact the NCR for additional guidance. You should never feel pressured into signing any documents you are not comfortable with. As debt counsellors we can advise and guide our clients, but in the end, the client still has to take action and commit to the agreed debt restructuring
It is every Debt Counsellors obligation to you, to explain all the pros and cans of debt counselling and to make sure you understand it all.
Bottom line is, If you don’t feel good about the debt counsellor or the situation then don’t sign anything until you are sure.
5. Debt Counselling is an ongoing process.
Any Debt counsellor worth his salt will be looking after you from start to finish. It all starts with good advice and transparency throughout the process.
Your debt counsellor should also make you aware of the Pros and Cons of going under Debt Counselling. A good debt counsellor regularly checks in with you and do follow-ups from time to time, sending you monthly statements and offer good customer service.
Having an appointed Debt Counsellor does not magically make all you debt and financial problem disappear. You will need ongoing guidance and advice while under debt counselling or when your situation changes and you want to make adjustments to your situation.
They will also assist and mentor you on how to make good financial decisions going forward. That is what good debt counselling is all about.
By being aware of these 5 things you can be sure of not falling victim to some of the debt counselling scams out there. If you feel uneasy about anything, make sure to educate yourself on debt counselling and do your own homework. Even ask around, as many South Africans have successfully gotten out of debt by making use of Accredited Debt Counsellors. Being over-indebted is a challenge on its own. So make sure to get good sound advice from the start.
If you have any question or concerns about the debt counselling process or any debt counsellor that approached you Feel free to contact us or request a free call back.