Debt Review Calculator

What Debt Review Actually Does

Debt review is a formal legal process created by Section 86 of the National Credit Act for consumers who are over-indebted — meaning they cannot meet their monthly debt obligations in a sustainable way. The process is administered by a registered debt counsellor and ends with a court order that restructures your repayments. It is not a soft negotiation; it is a legal restructuring backed by the NCA, and it gives you real protection from creditors while you are under review.

What Is Debt Review Under the NCA?

When you apply for debt review, a registered debt counsellor assesses your income, your expenses, and all your credit agreements to determine whether you are over-indebted under the NCA's affordability test. If you are, the counsellor draws up a restructured payment plan that gives you enough to live on and pays the rest to your creditors. The plan is then ratified by a Magistrate's Court or the National Credit Tribunal, making it legally binding on your creditors. While the order is in force, your creditors cannot repossess assets, take legal action, or list new defaults against you — and you cannot take on new credit.

How Much Will My Restructured Payment Be?

There is no statutory formula. The counsellor starts with your net income, subtracts reasonable living expenses (set against guideline benchmarks), and the remainder is your "available for creditors" amount. That amount is then distributed pro-rata across your creditors, after the counsellor's fee and a payment distribution agency fee. In moderate over-indebtedness cases the restructured payment typically lands around 70% of your current combined repayments; in severe cases it can be lower. The calculator uses 70% as a default and shows you the upper and lower bounds so you can see the realistic range.

Will Debt Review Hurt My Credit Score?

While you are under debt review, your profile is flagged at the credit bureaus and you cannot take on new credit. The flag is removed once all your debts under the plan are cleared and a clearance certificate is issued by your counsellor. After that, your credit record can be rebuilt — and many consumers emerge with a stronger record than they had before, because they have demonstrated they can repay consistently. The flag is a temporary protection, not a permanent stain.

When Debt Review Is Not the Right Answer

Debt review is not free — the counsellor charges a fee that is built into the restructured plan, typically the first month's restructured payment. For very small debt loads or short-term cash crunches, an informal arrangement with your creditors may be cheaper. And if your debt is so large that even a restructured plan cannot clear it within a realistic timeframe, voluntary snowball repayment or, in extreme cases, sequestration may be more appropriate. A registered debt counsellor can advise on which route fits your situation.

Related Tools

• Debt Snowball Calculator — clear debt yourself, no counsellor needed.
• Debt Consolidation Calculator — see if combining into one loan helps.
• Debt-to-Income Ratio — check the affordability ratio lenders use.