Start by deciding whether it is the right solution
A registered debt counsellor compares your verified income, essential living expenses and contractual repayments. The purpose is to determine whether you are over-indebted and whether a formal restructuring plan is appropriate.
The formal steps
1. Information and consent
The process, restrictions, likely costs and required documents must be explained. You cannot lawfully be placed under debt review without your informed participation.
2. Form 16 application
If you choose to proceed, the prescribed application records your household details, income, expenses and credit agreements.
3. Form 17.1 notification
Credit providers and registered credit bureaus are notified that an application has been received. Certificates of balance are requested so the assessment is based on verified account information.
4. Section 86 assessment and Form 17.2
The counsellor determines the outcome and notifies the relevant parties. If over-indebtedness is established, a restructuring proposal can be prepared.
5. Proposal and legal confirmation
Repayments and, where possible, interest terms are negotiated with credit providers. The arrangement is referred to the relevant court or tribunal for legal confirmation.
6. One payment through a registered PDA
The agreed amount is distributed to credit providers through a registered Payment Distribution Agency. Remaining current is essential to preserve the arrangement.
7. Clearance
Once the qualifying obligations have been settled and the legal requirements are met, the debt counsellor issues Form 19 and the credit bureaus are updated.
What debt review changes
- You may not take new credit while the debt-review status remains active.
- Creditors are dealt with through the formal process and the appointed counsellor.
- Your repayment plan becomes structured and legally enforceable.
- You must continue paying the agreed amount and cooperate with document requests.