PRESCRIBED DEBT INVESTIGATIONS – WHAT IS PRESCRIPTION?
Prescribed debt investigations is another service that OUDS specializes in. The Prescription Act 68, implemented in South Africa in 1968, was introduced as means of protecting South African consumers from unscrupulous credit providers, who are accountable for recklessly lending credit and have contributed to the detrimental debt crisis South Africa currently faces. Prescription in South Africa can be better understood by reading the following expert advice from Oyisa United Debt Specialists.
South African consumers have the two defences, In duplum and prescription, against credit providers:
- In duplum:The in duplum rule simply put, states that upon default, the interest charged against a consumer cannot exceed the capital outstanding, that is to say, all a consumer can only ever pay as a maximum, is double the original debt amount at the time of default.
- Prescription:Prescription in South Africa refers to old debt, which occurs when it is no longer obligatory for a debtor to pay off their debt. Unfortunately, many South African’s are not aware that debt can not aware that debt can prescribe.
The Prescription Act 68, implemented in South Africa in 1968, enforces the regulation of prescription and states that debt can be considered as prescribed if the following requirements occur:
- You have not acknowledged owing the money in any way or agreed to pay it in the past three consecutive years, either in writing or verbally
- You have not made any payment towards settling a debt, promised to make a payment to the outstanding debt amount
- You have not acknowledged or been summoned in respect of it to make a payment by a creditor for the debt within the past three consecutive years
If the debt has prescribed – You are not legally obligated to pay for it.
However, with regards to prescription in South Africa, it is important to bear in mind that not all debt prescribes in a period of three years. The following types of debt are likely to take an extended period of time to prescribe:
- Judgement debt – prescribes after 30 years
- Mortgage/Home loan debt – prescribes after 30 years
- Debts owed to the state/municipality. E.g. Tax, Municipal Debt, TV licenses – prescribes after 30 years
It is perfectly legal for a debt collector or attorney to demand payment for a prescribed debt. It is up to a debtor to raise prescription as a defense.
The purpose of prescription in South Africa is to compel creditors and collections agents to collect money owed to them within specified period and not delay recovery so that it accumulates massive amounts of interest and costs.
With over 11 years of specialized experience in the debt & legal field Oyisa United Debt Specialists is committed to assisting South African consumers in financial liberation.
We’ll launch a Prescription Debt Investigation, yet another “FREE” Phalanx© service that we offer South African consumers.
If you are finding yourself in this situation where you have been contacted by a debt collector on an account three years old or longer; and unsure as to how to proceed