You could be debtless after three years

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If you have been in debt for more then three years, you could be declared debtless.

So, if a debt collector contacts you, and the unpaid portion is older than three years, then it is apparently illegal for them to collect it.

According to Section 12 (1) of the Prescription Act 68, states prescription of a debt begins to run from the date of your last payment.

Prescription means that a debt ceases to exist three years after your last payment if completion of prescription is not interrupted.

Here is what you can do if you suspect creditors are collecting debt which has been unpaid for more than three years from you or anyone else:

• Do not acknowledge you owe debt if you are phoned after you have stopped payment

• Stop making Informal B-Creditor Debt Repayment Arrangements

• Defend any Formal B-Creditor Collection Proceedings against you and plead prescription when you are sued

For more information visit www.debtadmin.co.za

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