Cutting your expenses, boosting your income, and sticking to a strict budget aren't always enough to solve your financial problems. When they aren't, the next step is to negotiate a more manageable repayment plan with your creditors.
DebtBusters follows a structured approach to negotiating with creditors on behalf of our clients. Here's how the process works.
How DebtBusters negotiates with your creditors
1. We create a detailed debt list
The negotiation starts with a full list of everything you owe. For each debt, we record:
The creditor's name
The monthly payment obligation
The interest rate
The outstanding balance
Whether the debt is secured or unsecured
This gives us the complete picture we need before approaching anyone.
2. We prioritise your debts
Not all debts carry the same consequences, so we prioritise the negotiations accordingly.
High-priority debts are those with the most serious consequences for non-payment:
Your home loan (bond)
Rent arrears
Vehicle finance
Utility arrears
Court-ordered maintenance
Outstanding tax debt owed to SARS
Student loans
These come first because falling behind on them risks losing an essential asset or facing legal action. For lower-priority debts, which are usually unsecured debts such as credit card balances, we start with the debt carrying the highest interest rate.
Where a creditor agrees to settle a debt for a reduced amount, your credit report should be updated to reflect the new status. Under the National Credit Act, a paid-up judgement must be removed by the credit bureau within seven days of receiving proof of payment, and a settled default listing must be updated accordingly.
3. We review or build your budget
We go through your existing budget in detail, or help you create one if you don't have a working budget yet. This step matters because any repayment arrangement we negotiate has to be one you can realistically afford alongside your living expenses. Our guide on building a budget explains the process.
4. We gather your financial documents
Creditors will ask for evidence of your financial position, so we prepare it in advance:
Your household budget
Your debt list
A list of your assets and their estimated values
Your loan agreements
It's also worth thinking about whether anyone would be willing to stand surety for you, as some creditors may require this as a condition of a new agreement. A surety takes on responsibility for the payments if you default, so it isn't a commitment to ask for lightly.
5. We formalise the agreement
Once a creditor agrees to new terms, we make sure everything is documented in writing. The agreement sets out:
How long the agreement runs
Payment deadlines
The agreed payment amounts
The applicable interest rates
The fee structure, including when fees are payable
What the creditor has committed to, such as waiving fees or writing off part of the debt
What counts as a default, and what happens if you default
Putting the agreement in writing protects both sides. It creates transparency and legal clarity, and it prevents disputes about what was agreed.
Let DebtBusters negotiate for you
If you're struggling to pay off your debt, DebtBusters can help. Speak to a consultant at info@debtbusters.co.za, or call us on 086 999 0606.
