Can debt collectors take you to court South Africa?

Asked by: Miss Maureen Kerluke  |  Last update: September 18, 2022
Score: 4.3/5 (74 votes)

The debtor is called to court to give reasons why the debt cannot be paid. The court can make an order that the employer deduct an amount from the debtor's salary (emoluments attachment order) and pay it towards his debt.

What debt collectors Cannot do in South Africa?

A debt collector is not allowed to:

Use force or threaten to use force against you or your family. Physically threaten you or your family. Give, or threaten to give, information to the consumer's employer that may affect their opportunities as an employee. Serve any false legal documents.

Can I go to jail for debt in South Africa?

Though you cannot go to jail for debt, you can be imprisoned for owing money to SARS. If this is the case, you may also be without any other option than to find out how to declare insolvency in South Africa. Keep in mind that the sequestration process is in place to ensure creditors can receive the minimum benefit.

How long can you legally be chased for a debt in South Africa?

Does Debt Expire In South Africa? South Africa has a time limit of three years under its Statute of Limitation. debtors will have six months to pay the outstanding account, which is a maximum before summons have to be issued by the courts.

What happens when a debt is sold to a collection agency South Africa?

Once your debt has been sold to a debt purchaser you owe them the money, not the original creditor. The debt purchaser must follow the same rules as your original creditor when they collect the debt, and you keep all the same legal rights.

A legal way to avoid paying off your debt in South Africa according to South African Law.

35 related questions found

Can debt collectors issue summons?

Debt collectors will go to considerable lengths to collect large debts. If a debt collector sues you, you will be notified of the lawsuit via a summons, which will tell you why you are being sued, for how much and what date you must appear in court.

What is the 11 word phrase to stop debt collectors?

If you need to take a break, you can use this 11 word phrase to stop debt collectors: “Please cease and desist all calls and contact with me, immediately.” Here is what you should do if you are being contacted by a debt collector.

What happens if you ignore a debt collector?

Ignoring or avoiding the debt collector may cause the debt collector to use other methods to try to collect the debt, including a lawsuit against you. If you are unable to come to an agreement with a debt collector, you may want to contact an attorney who can provide you with legal advice about your situation.

What do I do if I get a debt summons in South Africa?

The sheriff will serve the summons on the debtor, whereafter they have 10 days to respond on whether they intend to defend the matter. If the debtor fails to serve a notice of intention to defend within 10 days, an application for default judgment will be made.

Is it a criminal Offence not to pay debt?

Can a person be imprisoned by non-payment of debt? Put in simple words, no person can be compelled to pay debt by threatening the latter with the filing of criminal actions. Suits arising from non-payment of debts are only civil in character which cannot be a ground for criminal action.

Is not paying debt a criminal Offence in South Africa?

So to answer your question whether you'll go to prison for debt — in short NO. We'll explain in a moment. There are different laws in South Africa that regulate the loan collection process. Debt collectors have certain limitations which they can't violate.

What happens when you don't pay your debt in South Africa?

A judgement will state that you have not paid your debt and it will reflect on your credit record for 5 years. When a judgement is granted, a creditor can apply for a warrant where the sheriff can attach goods such as your furniture and sell these to pay your debt.

How can I get out of debt collectors without paying?

There are 3 ways to remove collections without paying: 1) Write and mail a Goodwill letter asking for forgiveness, 2) study the FCRA and FDCPA and craft dispute letters to challenge the collection, and 3) Have a collections removal expert delete it for you.

How much interest can debt collectors charge in South Africa?

The Debt Collectors Act limits the fees a debt collector can charge to no more than the capital amount of debt or R814, depending on which is lower. Added to that, the debtor can be charged 10% on each instalment paid, although this, too, is capped at R407 per instalment.

Do you have to pay debt that was sold to a collection agency?

Many people ask, “If a debt is sold to another company do I have to pay?” Once your debt is transferred, you owe the money to the current company rather than the original creditor. However, the new collector must still adhere to all the regular debt collection laws.

What happens if you ignore a summons in South Africa?

It is a criminal offence to avoid or ignore the summons served against you. If you do not reply to the summons within 10 days, the Plaintiff's lawyers have probably submitted a request for a default judgement. It can take up to 3 months, so don't think the matter has just disappeared.

How long is a judgment valid in South Africa?

A judgment is granted by the court when legal summons is issued and you fail to defend the summons or make payment of the amount claimed. A judgment remains on your credit record for 5 years or until it is paid in full or a rescission is granted by the courts.

Can a debt collection company take you to court?

Debt collection agencies may take you to court on behalf of a creditor if they have been unable to contact you in their attempts to recover a debt. Before being threatened by court action, the debt collection agency must have first sent you a warning letter.

Why you should not pay collections?

Making a payment on the debt will likely reset the statute of limitations — which is disastrous. If the collection agency can't show ownership of the debt. Frequently, the sale of a debt from a creditor to a collector is sloppy. A collection agency hounding you may not be able to show they actually own your debt.

How do debt collectors find your bank account?

To find out if you've got savings or are expecting a pay out, your creditor can get details of your bank accounts and other financial circumstances. To do this they can apply to the court for an order to obtain information. You'll have to go to court to give this information on oath.

How do I fight back against debt collectors?

Here are a few suggestions that might work in your favor:
  1. Write a letter disputing the debt. You have 30 days after receiving a collection notice to dispute a debt in writing. ...
  2. Dispute the debt on your credit report. ...
  3. Lodge a complaint. ...
  4. Respond to a lawsuit. ...
  5. Hire an attorney.

Can I be chased for debt after 10 years?

Can I Be Chased for Debt After 10 Years? In most cases, the statute of limitations for a debt will have passed after 10 years. This means that a debt collector may still attempt to pursue it, but they can't typically take legal action against you.

What happens after 7 years of not paying debt?

Unpaid credit card debt will drop off an individual's credit report after 7 years, meaning late payments associated with the unpaid debt will no longer affect the person's credit score.

Which court deals with debt in South Africa?

Section 65A of the Magistrates' Court Act 32 of 1944 (“MCA”) allows for the recovery of a debt after judgment has been granted. While this form of recourse is only available in the Magistrates' Court, judgments obtained in the High Courts can be enforced through section 65M of the MCA.