Reckless Lending FAQ
1What if i can’t afford the loan and am now in arrears?
We champion our clients to make smart and responsible financial choices. If your circumstances have not changed and you find yourself in arrears and have fallen behind with your payments you may be a victim of reckless lending. read more
2What is reckless lending?
Reckless lending can be identified as the following: The financial or credit provider did not do any type of assessment. The client did not understand the risk of the credit. The clients income is less than the credit agreement and so cannot afford the loan repayments. The loan or credit causes the client to become over-indebted. read more
3What if I have applied for a number of credit or finance products in the same day?
A provider can only be held responsible for what can be reasonably expected to be known. read more
4Are there limits for the amount that can be associated with reckless lending?
The NCA associates reckless lending with over-indebtedness - which will rely on the assessment of the initial credit providers. read more
5Can my credit card be considered reckless lending?
Yes if you have taken out a loan, a credit card, a bond or vehicle finance after 2007 and have fallen behind or are currently in arrears, you maybe a victim of reckless lending. But you won't know for sure until fill our contact form and find out. read more
6What happens to my car if my vehicle finance is found to be lent recklessly?
In most cases if you have paid over 2/3 of your repayments you can get to keep the car, otherwise if you can't afford the payment then you have to be prepared that you might have to give the car back. read more
7What is over-indebtedness?
A consumer is over-indebted if it’s assessed that they will be unable to meet all their financial obligations in a timely manner. Based on the majority of information available at the time of the assessment including their: Financial means. History of debt repayment. If any of these apply to you or your family please contact us today. read more
8What responsibilities do my credit providers have when assessing me for credit?
A credit provider has to be responsible in giving credit, and cannot give credit to someone who will not be able to repay his or her debt. If a credit provider gives credit many times over to people who cannot repay their debts, it is not being responsible. In order to decide who can borrow money or buy goods on credit, and in what circumstances, a credit provider can set its own guidelines. These guidelines can be pre-approved by the Regulator. Alternatively, the Regulator can set guidelines which credit providers can refer to when making their decisions. read more
9Will this damage my credit rating?
We will do everything to protect your credit rating and it is unlawful for your lender to enter anything adverse whilst a dispute continues. read more
10What if my credit agreement is found to be reckless?
If your agreement is found to be reckless lending the Court will: Make an order to set aside all or part of the consumer's obligations and then suspend the credit agreement; Where the Court makes the above decisions you do not have to make any further payment to the responsible credit provider and your loan may be written off. The credit provider may not demand any payment from you. Which means no interest, fee or other charge under the agreement may be charged to you. read more
11Can the term over-indebtedness apply to all credit?
This concept of over-indebtedness and reckless credit does not apply to the following agreements and persons: Juristic persons, Pawn transactions, Incidental credit agreements, School loans, Public interest agreements, Emergency loans, Temporary increases in credit limit. read more
12What is the NCR?
The National Credit Regulator (NCR) is responsible for the regulation of the South African credit industry. It is is tasked with carrying out education, research, policy development, registration of industry participants, investigation of complaints, and ensuring the enforcement of the National Credit Act. The Act requires the regulator to promote the development of an accessible credit market, particularly to address the needs of the historically disadvantaged, low-income earners, and remote, isolated or low-density communities. The NCR is also tasked with registering credit providers, credit bureaux and debt counsellors. read more
13What loans can’t be reckless?
A consumer fined themselves to be over indebted when their total household income is less than the expenses and debt obligations each month. This also includes when a consumer cannot fulfill their monthly expenses in a timely fashion. Knowing what reckless lending is, is the first step, next… what loans can’t be reckless lending? read more
14Loans – Are They Reckless?
Reckless lending is a huge issue in South Africa, taking money away from those who cannot afford to lose it, this has been happening for years. Hurting those who cannot afford to seek out help and correct their finances, many of whom don’t understand the implications of debt, reckless lending is now a hot topic of the debt world, leading to sticky situations for many credit providers. So what exactly is it? If you took out multiple loans – are they reckless? read more
15What Is A Credit Bureau?
A question every credit user should ask and understand, what is a credit bureau? An integral part of the debt world, this is something that every consumer in South Africa should understand. Dealing with both consumer information as well as business solutions, this body facilitates the smooth and fair running of credit. read more
16What Is An Emoluments Attachment Order?
Within the National Credit Act 34 of 2005, the law states that before to entering into any sort of credit agreement with a consumer, the creditor must conduct a detailed financial assessment on behalf of the client – ensuring any lending would not be reckless... read more
17What Is The Law On Reckless Lending?
A legal document that can impact any credit user, what is an emoluments attachment order? A side of credit collection that is largely not talked about, unknown to many younger credit users, this is an item of great importance. Also referred to as a garnishee order, this is information that can help you understand the world of debt and credit a bit better... read more
18Where Can I Report Reckless Lending?
Do you have a little voice in your head that tells you your massive debt problem is not your fault? If that voice is not the same one that continuously encourages you to splurge on shiny accessories and the latest gadgets, it may actually have a point... read more
19Does A Reckless Lending Case Involve The Courts?
The short answer to this question is yes. If it is determined that your reckless lending case is solid, it will be referred to a magistrate’s court in order to determine if your loan can be written off. However, if you are a victim of reckless lending and you opt to have a registered debt counsellor represent you in court, you will not have to appear in front of a judge. Your representative will do that for you... read more
20What Is In A Credit Assessment?
In a nutshell, a credit assessment is the assessment of the creditworthiness of a borrower, whether in general terms or with respect to a particular debt or financial obligation. Anyone can undergo a credit assessment: an individual, corporation, state or provincial authority, and even sovereign government... read more
21Are you experiencing problems with a credit bureau?
Are you experiencing problems with a credit bureau? Follow our advice to help steer you towards the most effective solution: Your best bet would be to contact the Credit Ombud, in this position the Ombud has allowance to get involved in and resolve any complaints about credit information held by a credit bureau if they relate to a selection of topics: read more
22What is the sequestration process?
What is the sequestration process? Sequestration is the actual action of taking legal possession of assets, whether because of debt or non-payment. This, similar to the garnishing processes, this allows creditors or institutions to reclaim your assets on a legal basis. The claimed assets are taken to pay off your debt or to end debt, almost collateral as an afterthought, in order to fulfill payment. read more
23How do I eradicate debt, accumulated as a result of job loss?
Debt is something that affects South Africans from all walks of life. One of the main factors contributing to debt is job loss. When you lose your job, and you no longer have an income, you will have no way of paying off your debt. However, it is imperative that you take the following factors into consideration: read more
24What do I do if I am a victim of fraud and my credit record has been breached?
At Reckless Lending, we believe that the best thing to do when you become the victim of credit card fraud, is to lodge a dispute at the credit bureaus. Once you have done this, it will appear on your credit report, which is a good because if debt is accumulated in your name, you can prove that you had been the victim of credit card fraud. read more