Credit card debts, store accounts, phone contracts, increases in school fees, vehicle breakdowns, death in the family, serious medical conditions, and unforeseen circumstances can have a cumulative debt effect. You wake up one morning to find that you simply cannot afford your lifestyle anymore. To make things work out, you sell off some of your paid assets, or perhaps you try to consolidate the debt using a second mortgage on the home. A year later, the problem has escalated to the level where creditors threaten with legal action. You have stopped your satellite television contract, cancelled some insurance policies, opted not to renew the cellphone contracts, and have changed your children’s schools to make ends meet. Yet, because of mounting credit card debt, the interest simply makes it impossible to live.

You are Now at the Point of Looking at Debt Solutions. Which Ones Will Work?

You can opt for another personal loan, but you are already overexposed. Your credit record is unfavourable because you constantly miss payments, juggle bank accounts, and often find that you don’t even have enough money left in the bank accounts by the third of the month to pay bank fees. You are tired of having to avoid answering the phone out of fear that it is a debt collector that wants to push you into a payment agreement. You don’t have any energy left and your wife recently lost her job. Your income is not enough to cover the debt payments and a debt consolidation loan will not cover your mortgage, the vehicle finance, outstanding credit card debt, the school fees that are way overdue, and more.

A friend tells you about debt review, which he thinks is the perfect debt solution for you. However, with the amount you still owe on your house, it will take forever to get out of debt review. And what about the unsecured debt of store clothing accounts and credit cards? In addition, you have one vehicle on lease, which means that you will still have to pay the monthly lease or lose the vehicle, apart from having to pay the monthly consolidated debt review amount. You realise that since the debt is far more than R150 000, it is not the best option for you.

What is Left? Voluntary sequestration is perhaps not the first option, but considering that you have two loans registered against your house that will take years to pay off, you may very well find that voluntary sequestration is the best debt solution for you.


Once you have applied, the creditors can no longer initiate legal steps against you. The interest is frozen and this means that you will not end up with repayment agreements with excessive interest that will make it almost impossible to get out of debt. You can get rid of up to 80% of your debt simply by surrendering your estate through the voluntary sequestration process. Upon court approval of the sequestration, a trustee is appointed to manage the estate. The trustee sells off the assets and the proceeds are fairly distributed amongst the creditors. The remaining 20% is payable over a period of up to 24 months and because there isn’t additional interest payable, the amount can quickly be paid off.

You are now free from debt and can start afresh. In addition, you can apply for rehabilitation of your financial status following twelve months after the trustee has filed the first account. Depending on your particular situation, you may have to wait longer, but since you are debt-free, you are able to reorganise your finances to ensure enough savings to buy many items cash. You don’t lose your furniture, since the insolvency attorney negotiates to allow buy-back of the furniture at the reduced value, and the furniture is never removed from your house. The lawyer also negotiates payback on your vehicle and you are thus not without transport. Your tools of the trade still belong to you and your children don’t lose any of their assets.

Indeed, once you have discussed your financial situation with our insolvency attorneys, we can recommend a relevant debt solution, whether it is sequestration, administration, debt review, debt consolidation, or restructuring to help you become debt-free.