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Thursday, March 31, 2011

Supreme Court of Appeal re Nedbank V NCR

The Supreme Court of Appeal has dismissed several appeals dealing with the interpretation of the National Credit Act 34 of 2005 and confirmed the judgment and declaratory orders of Du Plessis J in the Pretoria high court.

Three matters were decided.

First, the Supreme Court of Appeal held that a notice in terms of s 129(1)(a) prevented a consumer from applying for a debt review in respect of that specific credit agreement because by giving such notice the credit provider ‘has proceeded to take the steps contemplated in section 129 to enforce that agreement’ 86(2)). It stated that such accounts could only be included if they are heard by a court which makes a section 85 (NCA) ruling to have this then also included in a debt review.

Secondly, the Supreme Court of Appeal held that a debt counsellor must make an application in terms of the Rules of the Magistrates’ Court when he issues a proposal in terms of s 86(7)((c) to the Magistrate’s Court in respect of a consumer who is over-indebted.

Thirdly, the Supreme Court of Appeal held that s 103(5) abolished the common law rule, known as the in duplum rule, in terms of which arrear and unpaid interest runs until it reached an amount equal to the outstanding capital sum. The subsection also did away with the rule that the in duplum rule is suspended pending litigation between the parties. Section 103(50) now governs the position which means that all the charges (and not only interest) ‘that accrue during the time that a consumer is in default under the credit agreement may not exceed the unpaid balance of the principal debt under that credit agreement as at the time that the default occurs.’ Which is good news for consumers.

Thursday, March 24, 2011

No Repo Rate Change

The Monetary Policy Committee's decision on Thursday 24th March was to keep the repo rate at 5.5% and prime lending at 9%. This is good news for consumers who should not expect the rate to be lowered in the near future. Predictions are that any future change will be an increase.

Monday, March 21, 2011

NCR to cut help for poor

On the 17th of March 2011 the National Credit Regulator (NCR) announced that they would no longer be assisting low income earners with a subsidy toward their debt counselling application costs.

Previously the NCR had offered a R750.00 subsidy to a DC accepting a case where the income of the consumers household was less than R3500.00. These funds were used by DC's to help cover their costs in regard to phone calls, faxes, emails, sms's, printing and time spent negotiating and preparing documents. Normally this would allow a DC to cover his costs. Without this contribution this will not be the case and DC's may now rather look to other clients in an effort to meet their monthly overheads. In a recent letter from Peter Setou the NCR announced that this arrangement would now fall away. While mention was made of the reason namely:"financial constraints" no mention was made in regard to where the funds that were formally set aside for the subsidies would now be spent.

This new development begs the question: is debt counselling now to be only for the rich?

Friday, March 18, 2011

Latest Credit Bureau Report information

As at the end of December 2010, credit bureaus had records for 18.51 million credit-active consumers:


• Of the 18.51 million credit-active consumers, 53.5% (9.90m) were classified as in good standing.

Congratulations all of you.

However....

• The number of consumers with impaired records increased to 8.61m this reporting quarter.This indicates a deterioration in the credit records of 120 000 consumers

• The number of credit reports issued to consumers increased to 79,635. Of the total credit reports issued,82.9% (66,034) were issued without charge, and the remaining 17.1%(13,601) were issued with charge. So it seems consumers are taking advantage of the opportunity to check their records in the month of their birth for free.

• There were 14,836 disputes lodged on information held on consumer credit records for the quarter ended December 2010, which was a decrease of 34.3% quarter-on quarter and an increase of 40.3% year-on-year. However good news is that the percentage of these disputes that were resolved in the favour of the consumer is very high.

Tuesday, March 15, 2011

DCASA Complaints person appointed

DCASA have appointed Ancil van Heerden to deal with any complaints that DCASA might receive from any party.

Ancil can be contacted at DCASA at: dcasa@dcasa.co.za

Monday, March 14, 2011

Monday, March 7, 2011

DCASA NEC

The DCASA National Executive Committee members are as follows:


M.P. da Silva

P.J. Davis

N.J. de Broize

A.J. Richards

G.G. Rodrigues

P.J. Slot

A.M. Snyman

Sunday, March 6, 2011

dont forget to give 3 months notice

SA banks have not been “particularly diligent” in warning bondholders of the cancellation charges they face if they terminate a bond agreement without giving three months’ notice.

Before selling property you should make sure you inform the bank of your intention to cancel the bond, otherwise you risk paying penalty charges.Many people selling their homes all too often find themselves facing cancellation charges of which they were simply unaware of.

Nedbank, exclude bond deals with a fixed interest rate from this three months’ notice stipulation and some other banks have been known to waive the cancellation fee in rare circumstances, like in the case of impoverished pensioners. However, in general, the banks ‘pounce’ when faced with the opportunity of earning extra revenue in this way.

When consumers put up their homes for sale, they should inform the banks of their intention to cancel their bond.

If, however, the three month notice expires without a sale taking place, it is then essential to renew the bond ....prior to canceling it again or homeowners will then have to pay another penalty for leaving the renewal a month or more.

It also sometimes happens,that a home on which a sale document is signed might not actually be transferred by the attorneys for two or three months. Here again, if the bond has not been renewed in the interval, penalties will be payable and transfer will be delayed until they are paid.

So talk to your bank when you place your property on the market and see what their requirements are or...be prepared to face these "hidden" charges.