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Nedbank offers hi-tech debt monitoring

Jan 24 2012 08:11 Mzwandile Jacks

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Johannesburg - Since mid-January this year, Nedbank Group [JSE:NED] has helped more than 13 000 struggling clients save their homes from foreclosure, said SA's fourth-biggest bank.

This followed the bank's launch of a payment solution website which assists customers failing to keep up with their mortgage payments.

The website, www.nedbank.co.za/HomeLoansHelp, allows clients to educate themselves about the best options for their circumstances.

The bank's struggling clients can use this tool to assess their situation and make the best decision accordingly.

Debi Mišura, general manager of Nedbank home loans collections and recoveries, said by making the right choice the bank's clients would be able to recover from difficult situations in the quickest possible time.

Four options

The website has four main options available to its clients, including paying back any missed payments over time and restructuring the loan over a longer period.

Other options including paying back a smaller amount each month and selling the house on the open market using a process called Nedbank assisted sales (NAS).

Miyelani Shikwambana, Nebdank's media relations officer, would not give a rough indication of how many clients the bank's home loans unit serves and how many of these stand to benefit from the website.

"Unfortunately we cannot provide this information at this time (because the bank) is in a closed period," Shikwambana told Fin24.

At the end of the second quarter last year, according to the National Credit Regulator, the total outstanding gross debtors' book of consumer credit surged by R15.9bn from R1.2 trillion to R1.23 trillion.

Topping this debtors' book was R773.37bn in mortgages.

The banks' share of the outstanding gross debtors' book was R1.10 trillion, about 89% of the entire book.

The site also provides an indication of when each option is most suitable, and an estimator that shows the financial impact of each option on the client's finances.

Once clients have an idea of how they would like to proceed or if they require additional information, they can contact a fully trained debt specialist equipped to provide advice and support for the client's decision-making process.

"Many clients have incorrect information about what happens at a sheriff auction. Our experience has taught us that these clients end up losing the most money," Mišura said.

"Our hope is that by providing information through this website and building a team of specialists to provide support, those clients will make better decisions earlier on in the process."

The two most popular options used by indebted clients include restructures and assisted sales.

Restructures are ideally suited for clients who still have a regular income but are struggling to make ends meet. By allowing the loan to be repaid over a longer period of time, the monthly repayment is reduced.

The NAS is suited for clients with severe affordability problems, typically due to a major drop in income.

Nedbank helps clients sell their property in the normal way on the open market, making use of an approved estate agent.

This gets a much better price than through a sheriff's auction. So, both the client and the bank benefit.

If the price achieved is below what the client owes the bank - and it often is - Nedbank offers appropriate terms to enable debt repayment while keeping a clear credit record.

Nedbank is currently helping between 100 and 150 people to sell their property this way each month.

 - Fin24

 
nedbank group  |  home loans  |  debt
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