If you've maxed out eight credit cards, what should you do?

A) Accept that learning to budget is a painful initiation into adulthood that all of us have to go through some time, so stop spending and put all your money into whittling your pack of cards down to one; or

B) Get deeper in debt by first paying a R50 application fee, then a R3000 first instalment on a "debt re-arrangement plan", followed by R300 a month for the next three years for a debt counsellor to help you with option A).

Okay, I'm being flippant. Sometimes we need professional help. Temporary setbacks like retrenchment, divorce, or a broken limb, with the financial trauma that invariably accompanies them, can sink one into suicidal despair.

If reciting the famous dictum, "This too shall pass", fails to keep you off the ledge, rather go to a debt counsellor.

But a reason I'm somewhat cynical about debt counsellors is that I have been asked to referee some of their dumber fights with banks.

For instance, one e-mail forwarded to me by a debt counsellor trying to show how unfair a mortgage provider was kicked off with a unilateral statement from the debt counsellor saying the client was taking a payment holiday.

The mortgage provider responded with a masterpiece of sarcasm, congratulating the debt counsellor on offering people payment holidays.

The financier wished it could offer a competitive service. Unfortunately, all it had to counter with was an auctioneer to kick the defaulting borrower out of his house if he did not cough up some money promptly.

National Credit Regulator CEO Gabriel Davel also raised this as a problem: "We found many cases where debt counsellors promote the debt review process as a payment holiday, with no realistic intention of effective rehabilitation."

Another false bit of marketing that debt counsellors have been using is misrepresenting the "reckless lender" laws introduced by the National Credit Act as a way to win a free house or car.

I've only seen one case reported so far where a magistrate ruled a bank had been a reckless lender for granting a mortgage to a pensioner where the repayments were higher than his monthly income.

Last I heard, the bank was appealing, so I don't know the final outcome. My understanding of the reckless lending laws is that they aim to punish both the borrower and the credit provider by having the underlying asset forfeited to the state.

This is a very scary law for banks, aimed at pressuring them into doing careful affordability tests before granting loans, but makes no difference for consumers who lose the asset they can't afford anyway.

Debt counsellors are cheaper than lawyers, and getting someone to coach you to live within your means is less severe than getting sequestrated.

But an unfortunate side effect of the introduction of debt counselling three years ago - which the National Credit Regulator plans to fix following a six-month study - is it has raised false hopes that the new rules can make bills magically vanish.