WENDY KNOWLER | Duped into debt review, tread carefully & know your rights
Consumer journalist Wendy Knowler's 'watch-outs of the week'
In this weekly segment of bite-sized chunks of useful information, consumer journalist Wendy Knowler summarises news you can use:
Debt review is not a means to reduce your instalments
I know of quite a few people who have received unsolicited calls in the past week — myself included — from agents whose opening line went something like this: “Would like to have your instalment repayments reduced by up to 50%?”
In my case, when I asked how my credit providers would agree to that, I was told: “Our programme does it.”
That agent ended the call when I kept asking awkward questions, but I knew where she was headed because I’ve handled a few cases where people were duped into signing up for debt counselling/review, despite not being over-indebted.
Debt counselling/review is a very specific legal process prescribed by the National Credit Act; designed to help over-indebted consumers rehabilitate. It’s facilitated by a debt counsellor who notifies the person’s credit providers and credit bureaus and then makes a recommendation to the magistrate's court for an order. The person’s first payment goes to the debt collector as their fee, and it can be as much as R8,000.
And you can’t get new credit until all the debt is paid off: in other words, it’s a process not to be entered into lightly. To get out of it, you have to pay a cancellation fee.
The National Credit Regulator says it’s received 107 complaints from consumers alleging that they were placed under debt review without their consent.
“We advise consumers to be vigilant, and not to trust or engage any company or person advertising debt review as a savings plan. Debt review is not meant for any other purpose other than to pay all credit providers what is due to them.
“Anyone who holds themselves out to the public to be a debt counsellor should be registered with the NCR. Only deal with debt counsellors who are registered.”
To find out if a person or company is registered with the NCR as a debt counsellor, go to www.ncr.org.za and click on “Registrants”.
Tread carefully or risk physical and financial injury
Have you checked your tyre tread recently? It’s a question which is most pertinent to those living in the Cape, in the midst of that province’s wet season, but all parts of the country experience wet days now and then in their dry seasons.
If you have a rear-wheel-drive car, the tread on your rear tyres is particularly significant because that’s the biggest factor determining whether or not you stay on the road when you hit a wet patch. Freeways are particularly treacherous, because speed increases your chances of losing traction.
Apart from the risk of serious injury or death as a result of veering off the road, that combination of wet road and poor tyre tread will most certainly result in your insurance claim being rejected.
That’s what happened to a Durban man earlier this year — his SUV left the N3 and rolled down an embankment, as a result of which it was declared a “write off” by his insurer. The company also rejected his claim because two forensic accident investigators concluded that his rear wheels lacked sufficient tread.
How can you tell? All tyre brands have tread wear indicators spaced evenly through the main grooves in the tyre tread. If they are flush with the level of the tread, then the tyre must be replaced.
The CPA can be confusing — even to returns agents
A quick Consumer Protection Act (CPA) refresher: different rights apply if you buy something in a shop as opposed to buying it online. With shop-bought goods, you don’t have the right to return them if they aren’t defective.
But if a product breaks in some way, or becomes unfit for purpose within six months of purchase, you can return it for your choice of refund, replacement or repair. You don’t have to settle for a repair.
When it comes to online purchases, the Electronic Communications and Transactions Act (ECTA) allows you to return an item within seven days of delivery for a refund, minus the courier cost of returning it to them (though the bigger e-tailers do not pass this cost on to their customers as a service).
It does not have to be defective: you simply get to change your mind and send it back; a perk you don't get when you buy something in a store. And that perk applies whether the product was on sale or not. But often consumers think they have a legal right to return non-defective goods to stores for a refund, and often companies’ customer care agents get confused and tell customers they have no right of return, when they have.
The latter happened in Blanche Andrews case. She only attempted to use the gas heater she bought from Takealot more than a week after it was delivered, and that’s when she discovered that its panel was defective. But when she raised this with a Takealot agent, she was told that she only had seven days to log a return and thus she was out of time.
In reality she had six months to return that defective heater, not a week.
When I took up the case, Takealot said it was “unfortunately a case of human error”.
“The returns agent evaluated the item and declined it in error, having applied the incorrect business rule to the evaluation.”
Andrews has since been refunded. As always, it pays to know your rights