NCR TASK TEAM. NCR Task Team Practical Guidelines for Debt Counsellors

Transcription

1 NCR TASK TEAM NCR Task Team Practical Guidelines for Debt Counsellors Compiled and Issued by DCASA on 17 August 2016

2 NCR Task Team Guidelines Training The purpose of the NCR Task Team Guideline Training is to re-inforce the Task Team Guidelines with specific reference to DCRS with the aim of improving DCRS usage to the benefit of over-indebted Consumers In this Training document reference will be made to the NCR Task Team Agreement Guidelines contained in Circular 02 of 2015 and subsequent CIF decisions. This document is not a replacement of the NCR Task Team Agreement Guidelines 2

3 Debt Counselling The Debt Counselling process commenced in June 2007 with an Act with a limited process or system. There were many implementation challenges. Task Team Agreement was approved in Task Team Agreement includes: - Process timelines and responsibilities (Annexure A) - Process enhancements (Annexure A) - Debt Counsellors Assessment Guidelines (Annexure B) - Debt Counselling System Guidelines (Annexure C) - Debt Restructuring Rules System DCRS (Annexure D) - Standard Forms (Annexure E) CIF reviewed the Task Team Agreement based on industry input. All members of CIF approved the Task Team Agreement. NCR has issued the Task Team Agreement as Guidelines in January All NCR Registrants are requested to comply. Courts are requesting copies of the Task Team Agreement. Process Enhancements Process re-defined to achieve consensual resolution where possible DC s required to submit proposals with assessment outcome (TT A 2.3.5(b)). CP s to consider and respond (agree if eligible and rules solve the case) (TT A (a) & (b)). DCRS to validate integrity of proposals submitted by DC s (TT Annexure D). Less contested Court applications (TT A 2.5.6). Standard Forms Certificate of Balance (COB) (TT Annexure E). Over-indebteness assessment summary (for 17.2 stage) (TT Annexure E). Cancellation of Debit Orders & Salary Stop Orders (TT A ). Debt restructuring proposal (TT Annexure E). PDA payment plan (Provisional and summary repayment plan) (TT Annexure E). Credit Provider responses (Letter of acceptance of arrangement proposal, Letter of decline of proposal) (TT Annexure E). 3

4 Purpose of Presentation To provide practical Task Team Training with reference to: Debt Review Process. Debt Review Process Obligations. Debt Review Process Timelines. Debt Counsellors Affordability Assessment. DCRS. The aim of the practical Task Team Training is to improve DCRS usage by Debt Counsellors and Credit Providers to the benefit of over-indebtted Consumers. Debt Counselling Partnership Debt Counsellor Consumer Credit Provider PDA 4

5 Debt Review Process 1. Application (Form 16) 11. S 87 Hearing & Court Order No termination 2. Assessment, Eligibility and Acceptance by DC 10. Set down < 60 S88(3) 3. Notification (Form 17.1) 4. CP COB Not in time NCA R24(4) 9. If accepted CP to Restructure the credit agreement. 12. After Care 5. Form 17.2(b) 6. Proposal + 8. Summary Repayment Plan 7. DCRS Solve = Accept DCRS no reply Non DCRS: CP Accept or Decline or Counter or no reply 13. Paid up confirmation 14. Clearance (Form 19) Step 1: Application Debt Review Process Description Consumer who cannot meet his or her monthly commitments can apply for Debt Review by completing Form 16. This may also be as result of receiving Section 129 Notice. In addition to the information prescribed in the NCA a Form 16 should include the following information: a. Details of applicable fees as per NCR Debt Counsellor Fee Guidelines. b. Consequences of direct payments as set out in terms of NCR Withdrawal Guidelines 002/20015 paragraph 5.2. Consumers should also be provided with Debt Review information document as set out in the NCR Task Team Agreement Guidelines (TT A 3.3.2). 5

6 Step 2: Assessment, eligibility and acceptance by DC Consumer is eligible (qualify) for Debt Review if the following conditions are met: a. All income and debt obligations included. b. Marital status declared, verified and applied accordingly (TT B 2.1 & 2.2). c. Reasonable repayment plan is possible. i. First aim is DCRS solve. Use the benefits of DCRS as selling tool to increase affordability amount. ii. If DCRS solve is not possible the repayment plan has to be reasonable. iii. No income means no Debt Review unless loss of income is temporally (2 to 3 months). Source of future income to be known (TT B 1.5 & 2.4). iv. No payment holiday (TT A 3.3.1). d. Full disclosure of household income as set out in Section 78(3) to be declared in all applications especially if living together or married ANC and the other party is not applying for Debt Review (TT B 2.3). e. Copy of payslip or proof of income (bank statements) essential (TT B 4.2). f. Assessment to be conducted in line with NCR Task Team Agreement Guidelines Annexure B. g. Compliance to NCR Task Team Agreement Guidelines Annexure B prerequisite to qualify for DCRS concessions. h. Once assessment is finalised the Debt Counsellor may accept the Debt Review application in terms of Section 86(6) of the NCA. i. Insurance premiums for assets financed as well as other insurance to be included in household budget (TT A 2.3.9). Step 3: Notification Form 17.1(b) Once DC has accepted the Debt Review application the DC has to: a. Within 5 days notify all Credit Providers in prescribed format (TT A 2.3). b. Update NCR Debt Help System. c. Submit Form 17.1 to Credit Providers (This is a request for Certificate of Balance (COB).) 6

7 Step 4: Certificate of Balance (COB) CP to supply COB to DC: a. Within 5 days of receipt of Form 17.1 (TT A 2.2.1). b. In prescribed format as agreed in the NCR Task Team Agreement Guidelines. c. COB to include consent to service. d. COB to include confirmation that debt has not prescribed as per CIF decision on the 1st of May If CP fails to provide COB within 5 days a DC should notify CP s that the information supplied by the Consumer will be used as per Regulation 24(4) (TT A 2.3.2). Compliance to the agreed timelines enables that the correct balance be used. Non compliance to agreed timelines leads to future disputes. COB balance is not updated during the Debt Review process. The aim of Debt Review is to repay COB value. End balances to be paid at the end of Debt Review (CIF). Step 5: Form 17.2 DC is required to make determination of over-indebtedness as per Section 86(6) and within 10 business days upon receipt of COB s (TT A 2.3.5): a. Notify CP s by submitting Form 17.2 with one of the following findings: i. Consumer not over-indebted (Form 17.2(a)). ii. Consumer is not over-indebted but experiencing difficulties to meet debt obligations (Form 17.2(b)). iii. Consumer is over-indebted (Form 17.2(b)). b. Update NCR Debt Help System status. c. Include Debit Order cancelation request (TT A ). Credit Provider required to cancel Debit Order as required related to a credit agreement (TT A ). A Debit Order cancellation request should include the Client name, ID number, credit agreement account number and Client signature. Debit Order cancellation per credit agreement, with the required information as set out above, has to be submitted to each Credit Provider. Sending a Debit Order instruction to Consumer s account holder is ineffective and cannot be implemented. 7

8 Debt Review Determination Determination in terms of Section 86(6) read with Regulation 24(7) Not over-indebted Section 86(7)(a) Not over-indebted but experiencing or likely to experience difficulty Section 86(7)(b) Over-indebted Section 86(7)(c) Reject the application Form 17.2(a) to Credit Provider Letter of rejection to the Consumer Regulation 25 Voluntary Repayment Proposal to Credit Providers Form 17.2(b) to Credit Providers and Credit Bureaus (Debt Help) Repayment Proposals to Credit Providers If repayment proposal accepted by all Credit Providers obtain Consent Order If not accepted by all Credit Providers approach Magistrate Court Debt Review Process Description Step 6: Repayment Proposal Repayment proposal based on the affordability amount as per Affordability Guidelines (TT A (B)). a. Always test for DCRS solve first. Increase affordability where possible to obtain DCRS solve. b. If DCRS solve is not possible repayment proposal to be reasonable and Section 103(5) to be applied (TT C & TT A (d)(vii)). c. DC to submit repayment proposal on same day as submitting Form 17.2(b) (10 days after COB s has been received) (TT A 2.3.5). d. Proposal to include income and expenditure summary (TT A (a)). e. Confirmation of assets can be sold to reduce over-indebtedness (TT A (b)). f. Repayment amount (TT A (c)). g. Appointed PDA (TT A (d)). h. Proposal to include insurance payment as declared on COB i. Proposal to include date of first payment (TT A (e)) & (CIF). j. DC to submit repayment plan to PDA which include cascading (TT A (e)). 8

9 Step 7: Proposal Response CP to respond on repayment proposal within 10 days from receipt of repayment proposal (TT A ). a. If DCRS solves CP required to accept (TT A (a) & TT D). b. If Repayment proposal include mistake CP can request rework. (TT E-Letter of Decline). c. On non DCRS proposal the CP can: i. Accept ii. Decline iii. Issue counter proposal d. Apply Section 103(5) on non DCRS proposals (TT A (b)(ii) & TT A (VII) & TT C 2.5.9). Step 8: Summary Repayment Plan Within 10 days of receipt of proposal response the DC should (TT A ): a. Record acceptance and non acceptance of proposals (TT A (a)). b. DCRS acceptance must be based on accepted DCRS proposal. c. Create a final repayment plan including consent and non consent. Allocated repayment amount, contractual terms and Section 103(5) used where non-consent or no reply received (TT A (b)). d. Finalise summary repayment plan and submit to CP s (TT A (C)). e. Include summary repayment plan in Debt Review Court Application (TT A (d)). f. Submit updated repayment plan to PDA (TT (e)). Step 9: Update CP Systems On receipt of Summary Repayment Plan CP s should: a. Update systems on accepted repayment plans (TT A ). Step 10: Set Down (File in a Court) DC should before the expiry of 60 business days submit the repayment proposal to the Magistrate Court (TT A (d) & 2.5.1(a)). If the repayment proposal differ from the current PDA plan the DC should submit an updated plan to the PDA (TT A (e)). 9

10 Step 11: Hearing On receipt Debt Review Court Order: a. DC to notify CP of outcome of proposal and Court date within 10 days of having obtained it (TT A 2.5.1(b)). b. DC to submit amended PDA plan if the approved repayment order differs from the current PDA plan (TT A (e)). c. DC to update NCR Debt Help System. d. CP s to update systems (TT A (a)). e. DC to submit approved Court Order to Credit Provider within 10 days of having received it. Step 12: After Care DC follow up on all unpaid advices received from the PDA and take steps to maintain payment in line with Order (TT A 2.3.7). CP s should not terminate where payments as per Order are maintained (TT A 2.4.1(c)). CP s to take reasonable steps to verify whether payments are made in line with Order (TT A 2.4.2). Step 13: Paid up confirmation a. DC to manage final payments in order to comply with Order and to ensure that debt has been repaid in full (CIF). b. CP s to supply paid up letters on repayment of debt (CIF). c. DC to submit amended PDA plan if the approved repayment order differs from the current PDA plan. d. DC to update NCR Debt Help System. e. CP s to update systems. Step 14: Clearance Certificate Form 19 DC to issue Clearance Certificate subject to: a. Receipt of paid up letters on all debt. b. Bond repayments up to date in terms of Order or Agreement. c. Able to maintain bond repayments. DC to notify all CP s and update NCR Debt Help System Legal clarity of the interpretation of Section 71 outstanding. CIF has requested clarity from NCR. 10

11 Debt Review Process Obligations The Debt Counselling process is set out in the NCA and Regulations. The following process weaknesses were identified: a. Process and format of Certificate of Balance (COB) (TT Covering Report (a)). b. Debt Counselling Affordability Guidelines (TT Covering Report (b)). c. Formulation of repayment proposals (TT Covering Report (c)). d. Payment distributions by PDA s (TT Covering Report ). e. Operational compliance (TT Covering Report 3.1.3). The Debt Counselling process enhancements as set out in Annexure A of the NCR Task Team Agreement Guidelines DC to issue Form 17.1 within 5 business days of acceptance (TT A 2.2.1). If no COB is received within 5 business days DC to issue Reg 24(4) Notice to CP s and accept info provided by the Consumer (TT A 2.3.2). COB balance is not updated during the Debt Review process. The aim of Debt Review is to repay COB value. End balances to be paid at the end of Debt Review (CIF). Within 10 days of receiving COB the DC should complete the Affordability Assessment and issue Form 17.2 (a or b) (TT A 2.3) and repayment proposal (TT A 2.3.5). When Form 17.2 is submitted the DC should also submit Debit Order cancellation form per credit agreement to each Credit Provider (TT A 2.3.6(f)). CP to respond to repayment proposal within 10 days of receiving proposal (TT A ). DC to record CP response within 10 days of receiving proposal response and create summary repayment plan (TT A ). DC to submit repayment plan to Magistrate Court indicating acceptances and non acceptances (TT A (d)). DC to submit repayment plan to PDA which includes cascading (TT A (e)). Reasons why COB balance is not updated during the Debt Review process The aim of Debt Review is to structure a debt repayment based on the COB value or information supplied by the Consumer in terms of Regulation 24(4). All parties are required to comply with Task Team Agreement timelines to avoid future disputes. This repayment plan is based on consensual repayment terms and/or Court approved repayment plan. 11

12 This means minimum repayment amount set in stone by Court Approval. If outstanding amount on any credit agreement is increased after COB a new payment plan is required. If the affordability remains constant the debt where value has been updated will receive an increased payment and all the other debt will receive a lower repayment. If payments are reduced below Court Order CP can commence with legal action. If value of one credit agreement is increased that credit agreement will receive preferential treatment. For the reasons above repayments are structured based on the information available at a point in time and the aim of Debt Review is not to balance the outstanding balance with CP. In Debt Review there will always be end balance differences and this can only be addressed at the end on the Debt Review process. The Consumer is required to repay the full debt and not only the amount of the Court Order. Credit Provider obligations set out in Annexure A of the NCR Task Team Agreement Guidelines On receipt of Debit Order cancellation form received with Form 17.2(b) cancel Debit Order and salary deductions (TT A ). Within 10 days of receiving DCRS repayment proposal accept proposals that solve or request DCRS rework (based on mistake) and on non-dcrs proposals accept, decline or issue counter proposal (TT A ). Not terminate a Debt Review after receiving F17.2(b) on a solved DCRS proposal where Consumers is making payments and has not breached material provisions (TT A 2.4.1). Use best endeavours to verify and allocate repayments (TT A 2.4.2). Not terminate if Consumer is not in default with agreed repayment plan and payment of credit linked insurance (TT A 2.4.3). Legal Contestation obligations set out in Annexure A of the NCR Task Team Agreement Guidelines - Debt Counsellor: Set down (file) matter before expiry of 60 business days and notify all parties within 10 business days of having obtained it (TT A & TT A 2.5.4). Where full agreement was obtained on repayment proposal obtain Consent Order (TT A 2.5.2). In absence of full agreement set matter down in Magistrate Court (TT A 2.5.3). 12

13 Legal Contestation obligations set out in Annexure A of the NCR Task Team Agreement Guidelines Credit Providers: Only oppose on material grounds (TT A 2.5.6(a)). Ensure that their Attorneys are aware and comply (TT A 2.5.6(b)). Conduct in the Debt Review process set out in Annexure A of the NCR Task Team Agreement Guidelines Debt Counsellors: Do not offer or allow Consumer payment holiday (TT A 3.3.1). Provide Clients with brochure and information to explain Debt Review process, benefits and consequences (TT A 3.3.2). If reasonable repayment is not possible reject Debt Review application (TT A 3.3.3). Obtain full and correct Client details on application (TT A 3.3.4). Follow and implement all steps as set out in Task Team Agreement (TT A 2.3.5). Monitoring Client non payment (TT A 3.3.6). Conduct in the Debt Review process set out in Annexure A of the NCR Task Team Agreement Guidelines Credit Providers: Ensure administrative co-operation (TT A 3.4.1). Implement policies to comply with Debt Review process and DCRS (TT A 4.4.2). Cancel duly authorized Debit Orders and Stop Orders when so requested (TT A 3.4.3). Terminate Debt Review where payments are not made within provisions of the NCA (TT A 3.4.4). Only oppose Court Applications on material grounds (TT A 3.4.5). Implement central point of contact for Debt Review matters (TT A 3.4.6). Implement policies to manage trade offs of competing claims between different Product Houses (TT A 3.4.8). Conduct in the Debt Review process set out in Annexure A of the NCR Task Team Agreement Guidelines Payment Distribution Agents (PDA s): Validate account numbers (TT A 3.5.1). Capture information supplied by DC correctly (TT A 3.5.2). Inform all parties of details of payments made or not (TT A 3.5.3). Submit monthly statements to Consumers (TT A 3.5.4). Make payment expeditiously (TT A 3.5.5). 13

14 Debt Review Process Time Line Maximum Response Time Time Line Action Day 0 Day 0 Form 17.1 Within 5 days from receipt of F17.1 Day 5 COB Within 10 days from receipt of COB Within 10 days from receipt of COB Day 15 Day 15 Form 17.2(b) & Debit Order cancelation instruction Repayment Proposal + Within 10 days from receipt of Proposal Day 25 Proposal Response Within 10 days from receipt Proposal Response Day 35 Summary Payment Plan Within 25 days from receipt Day 60 Court Set Down * DAYS REFERS TO BUSINESS DAYS * Debt Review Affordability Assessment Purpose of Affordability Assessment set out in Annexure B of the NCR Task Team Agreement Guidelines DC to determine if Consumer is over-indebted based on information available when assessment is done (TT B 1.1(a)). DC to determine if Consumers seeks declaration of Reckless Credit based on information when credit agreement was entered into (TT B 1.1(b)). DC to set up realistic budget for the Consumer as well as maximum possible amount to repay debt taking Consumer s budget into account (TT B 1.5(a)). Compliance will reduce opposition and speed up Debt Review process (TT B 1.4). 14

15 Eligibility to apply for Debt Review Annexure B of the NCR Task Team Agreement Guidelines Where Consumer has no income or prospect of income do not accept Debt Review application (TT B 2.1 & 1.5). If married COP both parties should apply for Debt Review (TT B 2.2(a)). If separated but not divorced (COP) cannot individually apply for Debt Review unless joint application (TT B 2.2(b)). If married ANC or living together consider joint application (TT B 2.2(c)). Full household income as defined in S78(3) to be used in Debt Review in Debt Review application (TT B 2.3). Temporary loss of income for 3 to 4 months can be accommodated if date of income resumption is known (TT B 2.4). Dealing with assets in Affordability Assessment set out in Annexure B of the NCR Task Team Agreement Guidelines Consumer to be encouraged to complete list of assets (TT B 3.1). DC to refrain from valuing assets (TT B 3.1). Identify assets, shares, second homes, extra vehicles that can be sold and savings to reduce debt (TT B 3.2 including subsections incorrectly numbered to 3.1.8). Ensure insurance is in place for assets financed (TT B 3.2). Joint bonds are normally problematic (TT B 3.3) (CIF to issue more guidelines). Determination of Nett Income in Affordability Assessment set out in Annexure B of the NCR Task Team Agreement Guidelines Use pay slips or bank statement 3 to 6 months (TT B 4 (a) & (b)). Deduct irregular income (TT B 4.4). Deduct statutory deductions (TT B 4.5). Deduct compulsory employer deductions (TT B 4.6). If Consumer is self-employed need to verify all sources of income (TT B 4.7). Set realistic spending budget (TT B 5 & 6 & 7 & 8). Where possible or required review Consumers financial position annually (TT B 10). 15

16 Debt Restructuring Rules System (DCRS) What is DCRS? Purpose of DCRS is to allow Consumers to benefit from DCRS concessions to reduce repayment period and to ensure that the Consumers become financially rehabilitated in the shortest possible period. DCRS launched in Feb DCRS = Debt Restructuring Rules System. DCRS is a central calculator which will verify DCRS calculations. DCRS ensures fair and consistent application of concessions. The software is centrally located and hosted by independent Hosting Company (Internet Solution). Access by DC to verify DCRS repayment rules is only possible via Debt Counselling Systems. Access by CP s to verify DCRS repayment rules is only possible via DCRS view only facility via controlled log in. Amendments to DCRS rules only possible with full industry consent. End goal being that only accredited rules deployed on the DCRS for validation purposes, will be used by DC s. DCRS process fixes due for incorporation The following DCRS fixes have been approved by CIF: Locking of COB information in Debt Review process (implemented). First Payment date (implemented). VAF calculation to be extended to 84 months from inception (implemented). Same Reference Number to be used throughout. Pro-rata interest to be added (from COB to date of first payment). No change to Summary repayment plan. The Z File (preparation file). Credit life to be changed to credit insurance. 16

17 DCRS Term Extension Rules Credit Agreement Mortgages VAF Deemed contractual term* Deemed contractual term* Deemed contractual term* Unsecured Unsecured Unsecured Rule Up to 240 months from date of restructure to maximum of 360 months from inception of the loan Up to 1.5 times contractual term subject to maximum of 84 months from inception Balance up to R1 500: Deemed contractual term 12 months and restructured over 18 months from date of restructure Balance R1501 to R3 600: Deemed contractual term 12 months and restructured over 36 months from date of restructure Balance above R3 600: Deemed contractual term 24 months and restructured over 60 months from date of restructure Balance up to R1 500: 18 months from date of restructure Balance R1 501 to R3 600: 36 months from date of restructure Balance above R3 600: 60 months from date of restructure *In credit facilities, such as overdraft, credit card or store cards, no repayment period is set. In DCRS a deemed repayment period is set in line with extension rules DCRS Rule Zero The assessment of the Consumer must be reasonable. Some Consumers are not eligible. Unnecessary assets must be sold to reduce debt. Minimum amount must be available to repay debt. Minimum amount must be allocated for expenses. No luxury items. Moderate non-essential expenses. Assets must be insured. 17

18 DCRS Restructuring Rules Affordability Amount Reduction of NCA fees Extension of Period Reduction of Rates Repayment Plan DC System Central System for Validations DC System DEBT RESTRUCTURING HIGHLIGHTS Fair Assessment No luxury Items Exclude Fees and Charges Exclude Cascading and Escalation Fixed Rate during concession period How does DCRS work? 1 Transactional & Non- Finance charges & interest penalties on pre NCA Agreements Waived 2 Monthly Service fee as per NCA (exclude transactional & non NCA fees) Waived 3 Secured Loans (Home and Vehicle) Interest reduction and term extension applied incrementally Floor limit of Repo + 2% 4 Unsecured Loans Interest reduction and term extension applied incrementally Floor Limit Zero % 18

19 Interest Rate Reduction in DCRS Step 1: Amount of interest rate reduction is the point where affordability amount is sufficient to solve DCRS repayment plan 30 % Repo a b c d Zero Secured (Home & Vechicle) Repo Unsecured Interest rate reduction linked to affordability amount and can be point a or b or c or d. Floor limit is Repo plus 2% Further Interest Rate Reduction in DCRS Step 2: No solve in step 1 that interest rate reduction on unsecured to reduce further to the point where affordability amount is sufficient to solve DCRS repayment plan subject to Zero floor limit 30 % Repo Zero a b c d Zero Secured (Home & Vechicle) Zero Unsecured Interest rate reduction on bond and vehicle to be Repo plus 2 and unsecured at point between c and d Floor limit is Zero %. 19

20 No Cascading in DCRS Cascading is where released affordability is used to repay remaining debt Before Cascading: Repayment amount R39 Month Debt A Debt B Debt C After Cascading: Repayment amount R39 Month Debt A Debt B Debt C Reasons why cascading is not used in DCRS When cascading is applied you undertake to increase payment exactly as per the cascaded plan. In cascading repayment is assumed based on COB or information supplied by the Consumer. In practice repayment will NEVER be in line with cascaded plan. Reasons include interest after COB, information supplied by Consumer not accurate, payment timing differences, additional fees, etc. If payment cannot increase exactly as per cascade the CP may commence with legal enforcement. This means if cascading is applied in DCRS the Consumer is set up for failure. The PDA plan should include cascading which should reduce the repayment period. Released affordability is used to repay remaining debt and this will reduce repayment term. 20

21 DCRS Process Affordability Assessment Submit DCRS proposal to Credit Providers Y Test for DCRS Solve N Submit Non-DCRS proposal to Credit Providers R Accept No Answer = Non DCRS Decline No Answer Counter Proposal Accept Contractual interest rates & S103(5) N Consider Counter Proposal Y Advise Credit Provider Summary Repayment Plan Court Proposal Why should Debt Counsellors use DCRS? Debt Counsellors will spend less time to restructure proposals. No counter proposal which speeds up the process. Restructure rules pre-agreed. Debt Counsellors find it easy to sell the benefits of reduced fees and interest rate to Consumers. DCRS speeds up the Court process. Consumers cash flow benefit can be up to 39%. The Consumers will rehabilitate sooner. Consumer benefits from added protection in terms of the NCR Task Team Agreement. Adherence to agreed process reduces disputes between the DC and CP. 21

22 What happens after DCRS? The aim is to repay unsecured debt within 60 months. In practice this may mean 61 or 62 months. When unsecured debt has been repaid the Bond concessions ends. Vehicle debt is normally restructured over 84 months from inception of the debt and this may mean repayment that exceeds 60 months. The effect is that contractual fees and interest rate will be applied on the Bond. New repayments should be calculated based on capital outstanding at that point in time, the restructured term and contractual interest rate. Debt Counsellors are advised to confirm future repayments when concessions ends with respective CP s and advice Consumers accordingly. Repayment plans prior to Clearance Certificate to be amended accordingly. Debt Counsellors are advised to inform Consumers of expected payments after Clearance Certificate to avoid legal action. Contact DCASA for any NCR Task Team Guidelines Questions Tel: dcasa@dcasa.co.za Web: Forum: 22

23 NOTES 23

24 NCR Task Team A Practical Guideline for Debt Counsellors is made available by the Debt Counsellors Association of South Africa 2016 Copyright subsists in this work. No part of this work may be reproduced in any form or by any means without the author s written permission. Any unauthorised reproduction of this work will constitute a copyright infringement and render the doer liable under both civil and criminal law. Whist every effort has been made to ensure that the information published in this work is accurate, the author and printers take no responsibility for any loss or damage suffered by any person as a result of any reliance upon the information or opinions contained therein. 24