MANY consumers are drowning in debt due to the economic crisis sweeping the country.

The rising cost of living is compounding the economic woes of already over-indebted consumers, who simply can no longer afford their debt or adequately provide for their families.

To a large degree, the problem was brought about by consumers who, during the good times, over-exposed themselves to credit and which creditors were all too eager to provide.

No-one, however, anticipated the economic downturn and consumers are left to their own devices to survive the situation.

Consumers consequently often find themselves in a state of hopelessness which negatively impacts on the wellbeing of both the family unit and communities.

Instances of depression, family violence and substance abuse increases accordingly and, in extreme circumstances, even suicide.

The workplace is also not immune to the effects of the economic crisis in that it leads to a lack of productivity and absenteeism.

In addition, employers are themselves struggling to make ends meet and are, for example, financially unable to implement increases ordinarily due to hard working employees.

The situation facing consumers is exacerbated by credit providers having an aggressive and harsh approach to debt collection.

Consumers are exposed to both telephonic threats from credit providers and to legal action which could result in them losing their homes, cars and other assets.

Merciless creditors appear to have no regard to the impact such actions have on the wellbeing of families and communities. Consumers particularly experience acute stress when their homes are attached and sold in execution. This is particularly so as, when properties are sold in execution, the proceeds of such execution sales, more often than not, realize substantially less than the outstanding balance due on the bond. So doing, Consumers not only loose their homes, but still remain liable for payment of the outstanding balance due on their bonds.

Johan Bester, a director of the DebtSense Group, said: “Enough is enough”. Credit providers should share responsibility for the over-indebted state of consumers.

They, after all, contributed with gay abandon to consumers‘ state of over-indebtedness.

This can readily be achieved by credit providers embracing the debt relief mechanism established in terms of the National Credit Act, as opposed to resisting it, as they are apt to do.

In terms of the National Credit Act, over-indebted consumers are not without legal remedy in that they can, in confidence, apply to a debt counsellor to be placed under debt review, the effect of which will be that they will enjoy immediate and absolute protection from their credit providers.

Care must, however, be taken to apply to a knowledgeable and reputable debt counselling firm. Once a consumer is placed under debt review, a creditor can no longer institute legal action against that person.

The debt review process briefly entails that a consumer‘s monthly debt obligations are reduced to affordable instalments with due regard to a consumer‘s required living expenses. Ultimately, all the debt obligations due to credit providers are settled in full in a structured manner in accordance with a re-arranged payment plan a debt counsellor would have developed.

As such, a consumer can afford his debt and once again adequately provide for his family and enjoy complete financial peace of mind. More over, consumers will no longer be at risk of losing their home, car or other assets in that the hands of credit providers‘ are lawfully tied.

Credit providers can furthermore not prevent over-indebted consumers from enjoying the lawful and effective protection the debt review process provides.

Bester added that over-indebted consumers owe it to themselves and their families to apply to a reputable debt counsellor to be placed under debt review.

Consumers no longer have to fear their creditors and can confidently face them head on.

Consumers must therefore be realistic about their financial situation. It will be irresponsible of consumers to live in a state of denial as, should they not deal with and confront their debt, they will soon enough be the victim of legal action with the resultant consequences.

Over-indebted consumers are legally entitled to debt relief and should not delay in availing themselves of the debt review process, irrespective of how large their burden of debt may be.

Consumers should also not allow that considerations of pride or embarrassment prevent them from obtaining lawful debt relief, which is readily available, as debt respects no class.

The DebtSenseGroup has hitherto effectively assisted hundreds of over- indebted consumers of all classes by developing responsible, achievable and sustainable debt re-arrangement payment plans.

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