(2) Case Study - Debt management plan

A Debt Management Plan (DMP) can be an effective way of paying off your debts in full at a much more affordable rate. Here’s how we helped one client with R1 070 000-worth of debt. Mr X  is married and lives in a mortgaged property. Over the last 2 years he has subsidized his income of R34, 000 per month, with credit cards, personal loans and overdrafts. The reason for his over indebtedness is due to the extensions to his home. He currently owes R1 070 455.68 with a monthly installment of R34 676.97   

As a result Mr X was at the brink of losing his most valuable asset, his home and it just wasn’t possible to make the monthly contractual payments to his creditors. Furthermore the creditors continued to add further interest and charges for exceeding his credit limits. Mr X approached Ramoth Financial Freedom Services and after completing his monthly budget, it was clear that he was only able to pay his creditor cards a total of R15 983.91each month.

 

RFFS were able to set up a debt management plan for Mr X, he paid R15 983.91 each month via payment distribution agency just after he had been paid and RFFS were able to get the majority of the interest reduced to 5.5%. He now has a realistic chance of becoming debt-free within 5 years (except bond)

 

 

 

 

 

 

 


 

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