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Johannesburg - Over the festive season and into the first
week of the New Year, debt counselling business DebtBusters has seen a doubling
of enquiries in comparison to the same period last year.
"We have been very concerned over the large increase in
unsecured debt over the previous 12 months and it looks like the consumers have
been delaying the inevitable and getting more unsecured credit to make
repayments on all their other debt," said CEO Ian Wason.
"In 2008 the average number of credit agreements our
clients had was 11; this has now increased to 13 in 2011, a worrying trend. It
looks like consumers are finally seeing the light that the only way to get debt
free is with the help of a debt counsellor rather than borrowing more
money."
Fortunately due to the changes in the debt counselling industry in 2011 such as the Debt Counselling Rules System (DCRS), DebtBusters now has mandates from 95% of the credit providers to extend terms and reduce interest rates down to zero if necessary.
This has resulted in over 80% of clients
being placed on an approved plan to be "unsecured debt" free within 60 months,
Wason noted. He added that over 75% of clients are home owners struggling
with their repayments.
"The introduction of DCRS has also meant that we are able to reach agreement with the banks on reasonable repayments for these home loans, enabling to stay in their homes while they rid themselves of credit card and personal loan debt."
