July 18, 2017

Debt Administration

What is an Administration Order?

An administration order is a Court Order obtained by a Magistrate to ensure that you keep enough of your monthly salary to maintain yourself and your family.

The Magistrate orders a Debtor (you) to repay debt in monthly instalment which are affordable to you.

This means that a figure is calculated with how much you can afford to repay each month on your total debt. This is done by deducting all your monthly living expenses such as food, school fees, budget for clothes, rent,  store account repayments from your salary/wages.

The Administrator pays the money into a trust account and every month   the Administrator will pay your creditors until all the Debt has been paid.

As soon as all the Debt has been paid, the Court issues a debt clearance certificate stating that all debt has been paid in full.

The Need for Debt Administration

It is not always possible for people to pay their accounts and still have enough money to buy food, pay for transport or to pay school fees and normal day to day living expenses. People often get caught in the debt trap by taking out loans and opening more accounts to pay for debt in order to keep their furniture from being repossessed or to put food on the table for their families.

The Debt Administration process applies to those who have less than R50 000 in total!