23 June 2015
Don’t be fooled into paying ‘old’ debt
Many people in South Africa are still unaware of what the law says regarding ‘old’ or ‘prescribed’ debt and end up paying off the debt, even though they are no longer liable for it. At DebtBusters, we want to make sure that you stay well informed and that you know your rights when it comes to managing your ‘old’ or ‘prescribed’ debt. Prescribed debt can be your debt solution!
As of May 2014, if your debt has prescribed and you have raised the defence of prescription or you would have raised the defence of prescription had you been aware of it, then credit providers may not attempt to recover your debt and you don’t have to pay.
However, credit providers might still approach you for payment even after your debt has prescribed. If they do, you need to know your rights and raise the defence of prescription. If your debt has prescribed and you have raised the defence of prescription on the debt concerned, credit providers are not allowed to contact you again for payment of that debt.
What makes debt ‘old’ or ‘prescribed’?
‘Old’ debt, also referred to as ‘prescribed’ debt, is debt that you legally owe but because there has been no activity or contact in connection with the debt for a period of three consecutive years, it ceases to exist.
The 1969 Prescription Act states a debt is prescribed if:
- For at least three years, since the date the debt was due, there has been no acknowledgment of the debt by you
- You were not contacted by the creditor for the debt, whether by summons, letter of demand or by phone, within the three years since the debt was due.
In other words, if you were not aware of the debt and you have never been contacted by the credit provider to repay the debt for three consecutive years,
- of the debt being due
- or of the last instalment that was made,
then, the debt becomes prescribed and legally, you do not have to repay the debt.
Important things to know about prescribed debt:
- If you make a payment towards your debt or if you acknowledge the debt during the three consecutive years from when the debt was due or your last instalment, your debt is no longer prescribed and you will be liable to pay.
- If you make a payment after your debt has prescribed, it will not reactivate the debt, and you are not liable to pay.
- Not all accounts can become prescribed. Your home loan, TV licence, municipal accounts and debt owing to SARS are excluded.
Is there an easy way to find out if my debt has prescribed?
If you suspect that your debt has prescribed or if you are having difficulty paying off your existing debt, DebtBusters, the leading Debt Management Company in South Africa, can help you.
DebtBusters is South Africa’s most TRUSTED Debt Management Company and we have assisted over 35,000 South African’s with their debt problems. Here’s how;
- We pull a free credit report for you and provide you with a free and confidential debt assessment (over the phone so you don’t have to take valuable time off work)
- We are able to quickly and easily consolidate your debt repayments into one affordable and lower monthly amount
- We will negotiate with your credit providers on your behalf to reduce interest rates and fees on your accounts
- We will get you legal protection and stop credit providers from harassing you for payments
- We will guide you all the way until you are debt free and when you are we will give you a Clearance Certificate and clear your name on the credit bureaus
Our process is 100% voluntary and confidential. Debt can happen to anyone. Take control of your debt today!
There are 3 easy ways to get in touch with us
SMS “your name” and “Prescribed Debt” to 47546
Call DebtBusters on 086 999 06 06.