Lungi’s* aunt was struggling financially, and she came to Lungi to ask if she could buy a few things on Lungi’s store account. Her aunt promised to pay the account later, but this never happened. Lungi became aware of this when she received a call from a debt collector about the unpaid account. She acknowledged the debt and has started paying R300 since February.
She missed payment for just one month, and a different debt collector from another company came to her house. He told her about the account, and she signed documents acknowledging the debt. She has been paying R500 monthly towards the debt through debit order since then.
Lungi realised a few months later that she was paying the debt off to two different debt collectors, and couldn’t afford to keep doing this. She has since stopped paying the debt collectors, and has been receiving emails and SMSs from both debt collectors.
She wants to know if they will garnish her, since she stopped paying.
Scorpion Legal Protection’s advice
It is very risky to take credit out on someone else’s behalf. The risk is that when the person fails to repay the debt as agreed, you will be liable for everything purchased by them. Worst of all, this could ruin your credit, as you might be listed on the credit bureau as a defaulter.
It was unwise for Lungi to stop paying the debt, as the credit provider might issue a summons and obtain judgment against her. When judgment is taken against her, the amount outstanding will be higher, as fees, interest and other charges will be added.
The store she owes money to can, through their attorneys, apply for an emoluments attachment order and start deducting money from her salary.
Lungi needs to contact the store’s accounts department to establish whether the two debt collecting companies are collecting for the same debt or whether there are two different debts which were handed over to them. Should she discover that it is for the same debt, she needs to inform the store so that they can reconcile the amounts already collected in order for her to know how much is still outstanding. She should then start making payments.
Tips:
- Be careful about getting into debt for someone else – if they don’t pay up, like in Lungi’s case, you will be the one legally responsible for repaying it
- If you’re struggling to repay your debt, contact the creditor and make arrangements with them rather than just stopping payment or not paying at all. They may allow you to repay the amount over a longer period or something similar.
- Don’t ignore your debt – it won’t go away by itself. If you ignore it, you could end up having your property repossessed by the creditor to pay off what you owe.
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* Terms, conditions, limitations and exclusions apply (click here to view the Legal Membership Agreement). This is only basic advice and cannot be relied on solely. This does not constitute financial advice. Names have been changed to protect identity.