Being pursued by debt collectors can be scary and overwhelming, but it doesn't have to if you understand your rights as a consumer and the rules collection agencies have to adhere to. In the debt collection game, knowledge is truly power.
Prescribed Debt
If your last payment in respect of a debt was made more than three years ago and you have not acknowledged that debt in any way during the elapsed time, and no one has summoned you in respect of that debt, it has "prescribed" and you are no longer liable to pay it. To benefit from the protection offered by the Prescription Act, you need to know about it. Unfortunately, unscrupulous lenders exploit the fact that consumers often aren't aware of their rights.
Keep in mind that not all debts can prescribe after three years. Mortgage loans, municipal rates, TV licenses, and traffic fines are excluded. You will still need to pay your current, legitimate debt.
How Debt Review Protects You
Debt review (also called debt counselling) shields you from aggressive debt collectors. Once a consumer enters debt review, all collection activities, including legal action and harassment by creditors, are paused. This process allows consumers to restructure their debts into a more manageable repayment plan, overseen by a debt counsellor, ensuring they can meet their obligations without losing essential assets or facing constant pressure from collectors. By placing consumers under the protection of the National Credit Act, debt review provides a legal safeguard, offering much-needed breathing room to regain financial stability.
Need help with prescribed debt or debt review? Reach out to our experts today.