*Disclaimer: Let me start off by saying that I believe
that people have a responsibility towards paying their debt – and that the
following article is in no way an encouragement to people to do otherwise.
Besides the abuse of women and children,
death by starvation in African countries and people with loads of money but no
taste – there is very little that gets me into a tailspin like debt collectors
demanding monies for debt which is prescribed!
What exactly is prescribed debt? According to the Prescription Act, a debt is
deemed to be prescribed if it has been three years since your last payment and
in three years you have not acknowledged the debt in any way – and neither has
the creditor summonsed you for it. That is it!
In many cases, the debt has been written
off by the initial credit provider and bought for virtually nothing by debt
Unfortunately, onus is placed on the debtor
to know that their debt is prescribed and use it as their defence when the debt
collector comes – a – calling! So what I am saying is – the debt collector knows
the debt is prescribed, but he will still call you, in the hope that you are
unaware of this.
You owed Creditor X an amount of R5000 in
2006. A debt collector calls you in 2013 and tells you that interest has been
added to the amount you owe creditor X and you now owe R12 000 and you
have to pay.
First thing you do – ask when your last
payment was made
Next thing – find out if you were ever
If no payment has been made on that account
for 3 years and no summons has been issued for that debt within the last 3
years – then that debt is prescribed and you are not legally bound to repay
Now we all know how aggressive and
intimidating debt collectors can be. But it does not matter if they tell you
that they are from the CIA, the FBI or from Mars. It doesn’t matter if they
threaten you with the loss of your possessions or blacklisting, if a debt is
prescribed – you do not have to pay it!
If a debt collector pursues you even though
you have told them of the prescription, ask them to supply you with a full
statement of your account including all payments made – and to clearly show
where you have made a payment in the last three years. As a consumer, you have
the right to a detailed statement when
you request it.
Whatever you do – do not make an
arrangement to pay an old debt – because this revokes the prescription - even if the arrangement to pay is done
As consumers we certainly have enough to
contend with in our everyday lives - and
enough to financially see to, that we still need to be worried about “old debt
“ which we by law, do not have to pay. so, when a debt collector calls you
about a prescribed debt – politely tell him that you know that the debt is prescribed and that you are fully
aware that you do not have to pay them. And then watch them disappear into the
far blue yonder!
A bond account, municipal accounts, monies
owing to SARS and your TV licence – cannot become prescribed debt. But retail
accounts, credit cards, Telkom accounts,personal loans, gym memberships,
cellphone accounts, money owing on vehicle finance ALL become prescribed after no payment or
summons issued within 3 years.
As consumers, we simply have to know what our rights are.
You can go to Moeshfieka’s website www.generationb.co.za or contact her
directly on firstname.lastname@example.org
National Credit Regulator: www.ncr.org.za
and 0860 627 627
Debt Counselling: www.creditmatters.co.za and 086 111 6197
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