A "debt buster" typically refers to specialized financial products or services designed to eliminate high-interest debt, most commonly through cash-out home refinancing, structured repayment plans, or specific legal, low-cost bankruptcy options (such as $99/month plans) intended to consolidate debt, lower monthly payments, and reduce financial stress.
A debt counsellor will negotiate with creditors on your behalf, potentially securing lower monthly payments and interest rates. In addition, the counsellor can put together a restructured payment plan for you, combining multiple debts into one so you pay a single, manageable amount every month.
Cons of debt relief programs include significant credit score damage from missed payments, high fees (often 15-25% of enrolled debt), potential for increased debt during negotiation, risk of lawsuits from creditors, and potential tax liabilities on forgiven amounts, all while offering no guarantee of success or creditor cooperation, making them risky alternatives to traditional repayment.
DebtBusters is South Africa's leading and most trusted debt management company. We help South Africans bust debt for good, through expert advice, personalised plans, and real, lasting results.
And, while you are in the program, the bill collectors have to stop calling. They also have to stop writing. Very simply, they have to leave you alone. That's what the Debt Buster program is all about.
Once you miss payments, you'll be considered “in default.” Creditors may then contact you through calls, letters, or even take legal steps to recover the money. Of course, if debt has prescribed, creditors can no longer take legal action against you.
The 11-word phrase often cited to stop debt collectors is "Please cease and desist all calls and contact with me, immediately," which leverages your rights under the Fair Debt Collection Practices Act (FDCPA) to halt most communication, though it must be sent in writing via certified mail to be legally binding, and collectors can still notify you of lawsuits.
Debt review extends the period of repayment, often significantly. This means that you will be committing to a long-term plan that may last several years. While this can make your monthly payments more manageable, it also means you will be in debt for a more extended period.
The "777 rule" in debt collection, also known as the 7-in-7 rule, is a CFPB regulation (Regulation F) limiting calls: collectors can't call more than 7 times in 7 days for a specific debt, nor call within 7 days of a conversation about that debt. It aims to prevent harassment, applying to calls, texts, and emails, though exceptions exist, and the presumption of compliance can be rebutted by aggressive call patterns like rapid succession or highly concentrated calls.
Bankruptcy is your best option for getting rid of debt without paying.
However, if you're not behind on payments and your credit score may qualify you for a lower rate, debt consolidation is likely the safer, smarter move. Not only will you be able to streamline the debt payoff process, but you also save on interest and protect your credit.
To write off debt you need to prove you are unable to pay what you owe. There are debt solutions that can do this for you. And, in some cases, the people you owe may agree to write off some, or all, of your debt. This may be through making a settlement offer.
Though it's a common myth, your debt doesn't disppear after seven years of nonpayment. Most debts drop off of your credit report after seven years, but in many cases, you'll still be on the hook to repay the debt.
The best way to pay off debt involves choosing a strategy like the Debt Avalanche (highest interest first for savings) or Debt Snowball (smallest balance first for motivation), making more than minimum payments, cutting expenses to free up cash, and potentially using balance transfers or consolidation loans if your credit is good, all while tracking spending and building a small emergency fund first.
This flag indicates that you are under debt review and restricts access to new credit. Here's how to know if your debt review flag has been removed: Obtain a Clearance Certificate: After settling your debts and completing the process, your Debt Counsellor should issue a clearance certificate.
The Takeaway. Debt settlement is offered by for-profit companies that may charge steeply for their services — and might not even be able to help. Credit counseling, on the other hand, is a more holistic service offered by nonprofit organizations that have your best interests and a firm financial future at heart.
This validation information includes the name of the creditor, the amount you owe, and how to dispute the debt. If the debt collector doesn't or can't provide this information, it could be a scam. Never give sensitive financial information to the caller, at least not until you've confirmed they're legitimate.
A "609 dispute letter," often mischaracterized as a means of getting negative information removed from a credit report, is a name sometimes applied to a formal request for disclosure of credit information compiled by one of the national credit bureaus (Experian, TransUnion or Equifax).
To deal with debt collectors, know your rights under the Fair Debt Collection Practices Act (FDCPA), which lets you stop calls with a written "cease and desist" letter, but the debt remains; you can also validate the debt or negotiate, often starting with a written request to stop calls, but be aware they may then proceed with legal action. Key strategies involve validating the debt (asking for proof), negotiating a settlement (offering less than owed), or blocking contact by sending a formal letter via certified mail.
The idea of jail time for debt stems from a historical practice known as debtors' prisons. These institutions were abolished in the U.S. in 1833, meaning today you can't be jailed simply for owing someone money. Unpaid consumer debts—such as credit cards, personal loans or medical bills—won't land you behind bars.
The "777 rule" in debt collection, also known as the 7-in-7 rule, is a CFPB regulation (Regulation F) limiting calls: collectors can't call more than 7 times in 7 days for a specific debt, nor call within 7 days of a conversation about that debt. It aims to prevent harassment, applying to calls, texts, and emails, though exceptions exist, and the presumption of compliance can be rebutted by aggressive call patterns like rapid succession or highly concentrated calls.