Debt review is not a one size fits all solution and is a process that should be addressed by a duly registered debt counsellor.

Debt evaluate isn’t a one measurement suits all answer and is a procedure that are meant to be addressed via a duly registered debt counsellor.

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A Fin24 reader underneath debt evaluate needs to promote his R1.5-million assets, settle his debt, and put down a deposit for a brand new area, however no financial institution needs to believe his software.

He writes: 

I’ve a house mortgage with Financial institution X. I recently have an excellent stability on my house mortgage of R360 000. Because of monetary issue, I’ve implemented for debt evaluate independently. My credit score rating nowadays is 650.

I wish to promote the valuables I recently personal, valued at R1.5 million, repay all my debt, and put down a deposit of no less than R300 000 for a brand new area. Alternatively, not one of the banks I’ve approached won’t even believe my new mortgage software till I settle. I will be able to settle once I promote my area, however I will be able to’t even get pre-approval for a mortgage.

I’ve a solid source of revenue and will have the funds for a spot of R2 million. This would be the 2d assets I purchase. 

Neil Roets, founder and CEO of Debt Rescue, responds:

For a shopper to go out debt evaluate, and as a way to observe for brand new credit score, all current temporary debt (this contains cars, however excludes house loans) needs to be paid in complete, and residential loans will have to be up to the moment. On this explicit case, the valuables may also be bought, and any finances closing after settling the bond may also be implemented to settle all of the temporary debt. As soon as all of the temporary debt is settled, a clearance certificates will probably be issued and the patron will not be underneath debt evaluate. The shopper will then be capable to observe for brand new credit score. New credit score being granted after the clearance certificates is issued, will probably be in keeping with quite a lot of components, together with (however now not restricted to) affordability and credit score rating.

Any new software for credit score, together with a pre-approved mortgage, will most effective be imaginable as soon as the clearance certificates has been issued. 

Questions is also edited for brevity and readability.