# Regulatory Compliance Category > National Credit Act Forum >  Dire Straits

## rozzer

Hi

Looking for some advice with the problem which I'm about to relate, please be patient as it may be a long article.
For many years now, a person who is very close to me, has been on the rocky road of addiction. This is an extremely traumatic situation for the people around them and they have no feelings whatsoever as long as they get their fix, whether it be drugs or alcohol. During this time they have had the most support anyone can offer, including financial, emotional, & rehabilitation. Time and time again the urge was too strong and reverted back to the old ways and to watch someone you love fall again is so emotionally disastrous and traumatic it hurts beyond belief.
The last time it happened they ended up in hospital where the 3 days was just enough to bring them to their senses long enough to realize how bad things were. We had no choice but to offer the last chance ultimatum in the hopes they would try before finally losing everything and everyone around them, a decision which broke all our hearts but it was necessary.
I don't know where they got the guts from but it worked and for the last 7 years they have been free from addiction (thank you God).
The reason I opened this thread is for the following, now you have the facts which has led to it.

During the hard times it was impossible for them to work due to their condition, so the bank was the place to obtain funds (unbeknown to us) which they were willing to lend, 3 banks to be precise and we have now been informed that the payments being made to the banks are not covering the debt and in fact the debt is increasing at a rapid rate due to the interest and the salaries they get is only sufficient to pay their way on a daily basis, they have no assets to speak of, the house is rented the car is an old one which they need to get to work or they will have no income at all.

I have now been informed that they have now but told that they may have their salaries Garnished.

My fear is that they will see no way out and return to their old ways and to a sad end for all of us.

If anyone can offer any constructive advice  and/or solution PLEASE feel free. 

Kind Regards 

Rozzer

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## Dave A

If the debt is too much as it is -

One option is to enter into debt counselling. However, if they are genuinely doing the best they can already, I'm not thrilled at the prospects of this improving their situation.

Another option might be to apply for voluntary sequestration (which is not without it's challenges too).

What sort of interest rates are they getting hit with on their debt?

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## HR Solutions

> they have no assets to speak of


Unfortunately you have to have a certain percentage of assets to sequestrate.

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## Houses4Rent

Sounds like reckless lending. If so the bank can be held liable I think.

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## sterne.law@gmail.com

To sequestrate yourself yes.
He friendly sequestration was the answer to this.

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## sterne.law@gmail.com

Has the debt not prescribed?
7 years clean and loans in that time.
But payments made?

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## sterne.law@gmail.com

Perhaps visting ProBono.Org is worth while.

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## rozzer

Hi to you all

Thanks for taking the time to offer some hope.
@Dave... I do not know what the interest rate is but I fear it is high as even the most they pay
never covers the amount required and consequently is rising (To Be honest I am scared to death to ask)
though I know I must at some stage

@sterne.law.... Not sure what to sequestrate oneself means & again what is meant by ' has the debt not prescribed'

I will visit ProBono .org and see .

I'm at my wits end!!!!!!!!

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## Dave A

Hi Rozzer,

Ultimately the thing is to face the situation head on and understand it needs to change. And there are only so many ways to do that.

My interest in "interest" is that this is a critical component in a debt burden that one may be able to change to make the debt affordable. So take a look at options on that front. Sometimes the threat of sequestration may result in a creditor revisiting their interest rate on the debt.

At the very least, prioritise eliminating the higher interest debt first.

The only other areas that come to mind not covered so far are overheads and income, but I'll trust for now significant thought has gone into these areas already.

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## sterne.law@gmail.com

Sequestrate is the personal version of liquidation, a last resort.
Prescription is a legal defence.
If a debt is 3 years or older it cannot b3 collected via thsi defence, in other words time is up.
But, and its a big but, if payments or acknowledgmenet of the debt have taken place that starts the clock ticking again.

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## wynn

Perhaps the debt they have is on credit cards?
The interest charged for overdue payment on credit cards is horrendous!
If this is the case negotiate a personal loan at an affordable interest rate and cut the credit cards up.

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## sakkie

Which banks are the loans with? 

And in what form? (Personal loan, credit card, overdraft etc?)

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## rozzer

Hi All

Thanks for taking the time to respond

Sorry for the lack of response on my part, I am still In the process of trying to communicate 
with them and establish the exact type of transactions, how many of them, who to, interest, and 
actual totals owed.

If I am not mistaken all of or most of the finances are in the hands of a company that is 
supposed to apportion the payments to the relevant organizations who are owed, this is 
a problem as far as I can see as I'm sure that this company obviously require payment for 
their services and I'm sure that comes out first and then whatever is left is apportioned to 
the relevant organizations. I hope to establish all this soon.

I have no idea as to what form of transaction was used to obtain the finances but I am pretty
sure it is with several banks.I have no idea up to now as how they managed it.?

I am at a loss to be honest how anyone can obtain finances from any institute including banks, 
loan companies or any other way when they have no assets of any kind or without a a credit check.

(am I so naive)?

Regards

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## Dave A

> If I am not mistaken all of or most of the finances are in the hands of a company that is 
> supposed to apportion the payments to the relevant organizations who are owed,


That sounds like it may be a Payment Distribution Agency, which means they might be under debt administration already.




> this is a problem as far as I can see as I'm sure that this company obviously require payment for 
> their services and I'm sure that comes out first and then whatever is left is apportioned to the relevant organizations.


This is why I have my reservations about just how effective debt administration might be as a solution.

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