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Debt Collection

Debt Collection in South Africa

Debt collection is an intricate process that is governed by the National Credit Act of South Africa to ensure ethical and legal guidelines are adhered to at all times.

The need for debt collection arises when a debtor is unable or refuses to meet his or her payment obligations.

There are various methods of collecting outstanding debts, but what is more important that the correct step-by-step process is followed in order for the collection to remain legal and in accordance with the Act.

Debt Collection Process

There are two initial phases to the debt collection process which are:

• Standard collections phase – basic measures are taken to recover the outstanding debt. This is generally by demanding payment from the debtor
• Legal collections phase – this phase is entered into when the standard collections phase was unsuccessful

The legal collections phase can only be initiated once the debtor has failed to pay the debt after being approached by a legal debt collector. This phase can be broken down into the following steps:

• Delivering the summons – this must be issues at the court within the same jurisdiction as the debtor’s residential address
• Time period for response – once the debtor has received the summons, he or she has 10 business days to either pay the debt or file and serve a notice of intention to defend the legal action
• Default judgement – a default judgement is issued if the debtor fails to defend the summons within the stipulated time period
• Warrant of execution – once the default judgment has been granted, the creditor may deliver a warrant of execution against the debtor’s property
• Attaching moveable property – the sheriff within the same jurisdiction will visit the defendant to attach all moveable property to the value of the outstanding debt
• When there is no moveable or immovable property to attach – in this case, the creditor may proceed with a financial enquiry in court where the debtor must appear and a court order will be issued
• Emolument attachment order – if the debtor fails to honour the court order, an emolument attachment order allows for the monthly instalment due to the creditor is deducted from the debtor’s salary by his or her employer

Van Deventer & Van Deventer Incorporated – Debt Collection Attorneys South Africa

Our attorneys provide legal assistance with the debt collection process in South Africa, ensuring that all the guidelines as stipulated in the Act are adhered to.

We use efficient, ethical and effective legal methods to assist you with debt collection in South Africa. Contact us for more information.

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