How to Get a R5000 Loan Even if You Are Under Debt Review

How do you get a $5,000 loan while under debt review? Introduced to South Africa in 2007 by the National Credit Act, debt review is a legal process where highly indebted citizens are provided with debt counseling and a debt management plan. Debt review covers a wide range of debts, including utility bills, car loans, credit cards, etc.

Debt review is not the same as being insolvent; rather, it is to protect you from becoming insolvent. It is a legally recognised lifeline for those struggling to pay debts. 

Anyone who is under debt review cannot get a new loan. The National Credit Act stipulates that as the general rule. But to every general rule, there are exceptions. So what if this rule also has an exception? What if you could still secure a loan while under debt review? Let’s find out.

Also read: How to Apply for UIF in South Africa 2024

How to Get a $5,000 Loan While Under Debt Review 

Getting an R5000 or more in South Africa is easy. You can fix one through commercial banks, credit unions, or digital money lenders. 

But once you are under debt review, the story changes. The National Credit Act provides that no one under debt review is eligible for further loans until they have completed the debt review process and are no longer over-indebted. And since the Act mandates creditors to check your credit history before proceeding with your application, they would be able to detect that you are under debt review. At this point, most lenders will reject your application immediately. 

Loan Providers that Offer Loans while You Are Under Debt Review

So how do people do it? The major way to get a loan under debt review is through unregistered loan providers. These providers are not guided by the provisions of the National Credit Act nor the Financial Advisory and Intermediary Services Act 2002 (FAIS); hence, they will not need to conduct a credit check. Some registered loan providers also advance loans without a check on your credit history. 

While all of these seem tempting, it is advisable to go through with your debt review until you are totally cleared, then you can source new loans.

Going under debt review is an important decision that you should see through to the end, as it would help your financial stability. The law against incurring more debts while under debt review is not to restrict you, rather protect you from going in debt circles all your life. 

However, if your situation is immensely tough and you have made a decision, here are some providers that can advance a loan of R5000 even while you are under debt review:

• Easy Finance 
• Loans.co.za
• Cash Converters 
• Wonga

These loan agencies offer R5000 without credit checks or paperwork. The application process is completely digital and can be completed in a matter of minutes. After deciding on where you would like to take the loan, you can start the application process. Below is a step-by-step:

Step 1: Prepare All Relevant Documents and Materials 

Before you start your online application, ensure you have all the loan requirements. This will enable a quicker application process. Here’s what you will need to get a R5,000 loan under debt review: 

• A feasible repayment plan
• Proof of residential address
• A mobile phone and swift Internet
• Proof of age: you must be 18 years of age or older
• Proof of South African citizenship or permanent residency
• Valid South African ID; driver’s license, international passport, etc
• Proof of a South African bank account where the funds will be disbursed
• Payslips, bank statements or any other solid proof of income over the past 3 – 12 months
• Some lenders will still run a check on your credit history; a poor credit history will not ruin your chances of getting the loan but may come with higher interest rates

Note that these requirements may vary with each loan provider, however, nothing beyond the scope of what has been listed above should be requested in your application process. 

Also read: Smart ID Online Application South Africa 2024

Step 2: Apply for Your R5,000 Loan Online 

Next, head onto the website of your Loan provider and take the following steps: 

• You may be asked to register or log in, depending on if you are a first-time or returning customer.
• You can use the loan calculator to estimate the interest you will be paying on your loan. Most loan providers have this calculator on their websites. 
• If you are fine with the calculated interest rate and ready to move ahead, click the “Apply now” button.
• Follow the online application process and hold on a few minutes for the agents to verify your information.
• If there are no issues with the information and documents provided, your loan will be approved.
• Some lenders will provide a loan agreement for your e-signature
• Your loan will be disbursed.

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Frequently Asked Questions 

Is Debt Review in South Africa a Good Idea?  

Yes. When your debts have accumulated to a point where you are confused about managing your finances, applying for a debt review is a wise financial decision. It keeps you at peace and provides workable solutions to settling your debts. 

Is Debt Review in South Africa Free?

No. Debt review in South Africa is not free. However, the National Credit Regulator provides a guideline for debt review fees, which the debt counselor must abide by. Your monthly repayment plan will typically include a deduction for the fees, which depend on how much debt you have.

How Long Will I Be Under Debt Review in South Africa?

The amount of time you spend under debt review in South Africa is usually determined by how much you owe, and how much repayment you can make every month. The higher the amount you can repay, the faster you will be cleared. However, no matter how huge your debt is or how slow your repayment is, the system will be structured in such a way that the maximum time you can spend under debt review in South Africa is five (5) years. 

How Does Debt Review Work in South Africa? 

A professional debt counselor assesses your financial situation and negotiates with your creditors to develop a feasible debt repayment plan that suits your monthly income. Your counsellor provides advice and support through the process, and the debt repayment plan is developed based on your unique financial situation; it is not a one-size-fits-all plan. Note that debt review in South Africa is not free. 

Welcome to a Debt-Free Lifestyle 

It’s hard, we know. Having to forgo most of your expenses so you can pay off your debt. It’s a difficult decision, but a necessary one. And we are proud of you for taking that bold move. 

Debt review requires discipline to achieve your repayment goals. Avoid extra loans for now. Rather, make sure your debt counselor develops a repayment plan that does not overstretch your monthly income. You should still be able to meet your basic needs even while clearing off your debt. 

So stick to the process with perseverance, knowing that one day you will be out of it. We are rooting for you.

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