• An Administration Order is a Court Order that intervenes between a creditor and debtor who cannot afford their repayments.

• This will keep your creditors at bay and prevent them from taking further action against you. It will also prevent you from taking out further debt, but if you can’t afford your existing debt it makes no sense to take on more burden.

• The constant threats from your creditors of having your salary garnished, furniture/assets removed is stopped, allowing you to carry on with your life as normal.

• We work out an agreed affordable amount you can pay each month and the Court then places you under Administration.

• You pay your Administrator every month and this is divided amongst all your creditors on a three-monthly basis.

• There are certain costs that are payable to your Administrator that is prescribed by Law and that will be explained to you prior to the application being processed. Clients can be placed under Administration if their unsecured debts do not exceed R50,000 and if they have a monthly income.

There are certain documents required include: Payslips Identity documents Proof of all debts Bank statements Administration should not be seen as a permanent solution to your debt.

You should also bear in mind that all debts incur interest and as such, we encourage you to pay as much as you can afford so that the debts can be cleared as quickly possible.

Creditors have to contact us for payments in future, once the Order has been granted and may no longer pursue you once they have been placed under Administration.

 

How much will an administration order cost?

• An Administrator is allowed to take up to 12.5% of the monthly payments for his/her service.

• The employer of a debtor is allowed to take a 5% management fee, because it must pay the Administrator the specified sum of money if there is an emoluments attachment order granted.

• An administration order does not stop interest from running on outstanding debt.

 

How is an application for an administration order made?

• Speak to us and we’ll complete a thorough application with you over the phone, taking details of all your debts as well as the money you need to live on each month from your income.

• If we can assist, we will send you a completed application form to sign and return to us, along with a payment instruction via debit order, as well as an affidavit.

• We will then notify all your Creditors of your application and obtain a date for the matter to be heard at your local Magistrate Court.

• A copy of the application and supporting documents must be delivered to every creditor prior to the hearing.  Any creditor may object, however, in our experience this seldom happens, and matters are usually granted without any delays.

Note, you will need to attend Court in person on the day of the hearing.

 

What will happen if the court grants an administration order?

• An Administrator will be appointed to enforce the administration order.  This means that the Administrator must:

o inform every creditor and the debtor’s employer of the administration order;

o draw up and lodge a complete list containing the names and amounts owed to each creditor; and

o collect payments and distribute them among the creditors at least once every three months, unless the Magistrate’s Court orders otherwise.

• The order must specify the amount the debtor must pay and the time of payment.  The order may also specify whether there are any assets that the debtor must sell to settle the outstanding debt.

• The court may authorise an emoluments attachment order or a garnishee order.

• While an order is in force, no creditor may proceed with legal steps against the debtor, except in limited circumstances, for example, a mortgage bond due.

• Upon full payment of the debt: o the Administrator will lodge with the clerk of the Magistrate’s Court a clearance certificate stating that the costs of administration and the creditors have been paid in full;

o copies of the clearance certificate are sent to the creditors and employer of the debtor; and

o an application for the administration order to be cancelled (rescinded) is made to the Magistrate’s Court.