When a loan – or debt – prescribes, it means that the debt has not been acknowledged over a certain period. Generally, loans can prescribe after three years if you have not made any payments, not promised to make any payments, and you have not been summoned to court with regards to your debt. However, not all loans can prescribe – at least not within three decades. So what loans cannot prescribe?

Here is a list of the types of loans or debt that cannot prescribe:

Home loans

Debt accumulated on a home loan will only cease to exist after 30 years. This means that your home loan will still be payable, and any interest and penalty fees will have to be paid to your credit provider. Failure to pay your home loan could result in a foreclosure.

Municipal accounts

Municipal accounts (or municipal bonds) are debt obligations issued by government entities. This includes taxes, rates, and electricity. If you fail to pay your rates and taxes, the Municipality will cut off your electricity, even if your electricity bill has been paid in full.

Tax-related debt

It is a criminal offence to avoid paying your taxes. SARS has a number of debt collection options at their disposal, from selling your assets to collecting the outstanding money from your employer. If you are having difficulties paying your taxes, it is advised that you contact SARS to avoid their collection steps.

Judgment debt

If your credit provider summons you to court and your defence is unsuccessful, you will be issued with a court order to pay your creditor what you owe them, including legal fees. This debt will then be referred to as a judgment debt.

TV licence

A television licence secures your legal viewing of local channels for an entire year. Forgetting to renew your TV licence means a penalty of 10% per month to a maximum of 100% per annum, and the outstanding amount will remain payable for 30 years.