In the past, when under debt review, it may have been possible for outstanding debt to keep growing. However, according to the new industry rules, debt counselling rules engine that was implemented in February 2011, the problem has been eliminated.
With an acceptable repayment plan, “All Debt Solutions” has mandates from the banks to reduce interest rates. Once “All Debt Solutions” are able to secure such an agreement, debts will certainly be reduced over time.
The first step involves sending proposals to the banks within 20 business days of applying for debt review. Many banks will amend the interest rates on the client’s debt from the date that they accept the proposal, thereby halting the growth of debt.
If clients miss a payment after this agreement has been made, the original interest rate may be reinstated, thus making it an imperative that payments are made on time every month.