The debt collection process is a simple process with severe consequences for the unaware debtor.

So you skip a payment here and there and think it will not have an effect, as long as you make a payment again next month, right? Sure some creditors do not proceed with legal action the first month you default on your debt repayment, but they may.

The silent effect of this conduct is that it influences your credit recordYour credit record reflects your payment history for a period of 24 months.

Each month you default on a debt payment it reflects this on your credit report. It is this information that determines your credit score as credit providers use this information to ascertain what type of lender you are and calculate the level of risk involved to enter into a credit agreement with you.

Obviously, the more of a risk you are to the credit provider, the higher the interest rate which you will pay.

It is wise to check your credit report at least once per year for various reasons, one being to ensure that you have not been a victim of credit fraud.

Creditor Legal Action Process

Once you have defaulted on the credit agreement the credit provider may proceed to institute legal action against you.  The legal action process is as follows:

Section 129 Notice → Summons → Judgement → Attachment

Usually, creditors will first contact you telephonically to enter into a payment arrangement. They will attempt to contact you all hours day and night to get you to say “I will pay at the end of the month” or some other, usually empty, promise to pay.

When you do not honour this promise, they will continue to contact you until such time as you either pay, or it becomes evident that the telephone calls do not persuade you to rectify your default in payment. In terms of the Debt Collection Act, you may only be contacted between 07:00 and 21:00.

The creditor will subsequently issue a Section 129 Notice which will be delivered to your “domicilium citandi et executandi” address.

Note: Domicilium candy et executandi is a Latin legal term meaning the address nominated by a party in a legal contract where legal notices may be sent. It is important to note that the onus remains unto you to update this address with the credit provider, should it change after the date of the agreement.

Serving Section 129

The Section 129 Notice must be served by Registered Mail, except should you have consented to another form of service at the time of signing the credit agreement. The Section 129 provides the consumer with the following three remedies:

  1. Settle the arrears owed to the creditor;
  2. Dispute the amount owing, should the consumer disagree with the creditor’s claim;
  3. Consult with a Debt Counsellor to restructure the consumer’s debt, in the event that the consumer is in fact over-indebted.

The Consumer has 10 business days to action one of the three options. The 10 business days is calculated from the day the first receipt was sent to the “domicilium” address.

Just in case you thought you identified a “loophole” by not collecting the letter from the Post Office, or keep moving in an attempt to avoid honouring your debt, the National Credit Act also thought of this so your ideas will not have the desired results. 10 Business days after the first notice has left the Post Office, the Section 129 Notice is considered lawfully served, in terms of the National Credit Act.

The Summons

In the instance where the consumer does not act on one of the above three options, within the 10 business day, the creditor may now proceed to issue a summons on the outstanding debt.

The summons is delivered by the Sherriff of the Court, also usually to the “domicilium” address. The Sherriff will attempt to serve the summons on you three times.

Should you not be available during the three attempts the Sherriff may affix the summons to an entrance or merely place it in the postbox. The summons is then also considered lawfully served. The summons provides you with another two options:

  1. Consent to judgement whereby you acknowledge that the debt is due and consents to the creditor applying for judgement against you (please note the effects hereof later in the article).
  2. Enter an Appearance to Defend whereby you complete this section on the summons document and hand it in at the Clerk of the Court which issued the The Court will then issue a hearing date on which you can state your case at Court. You can also attempt entering into repayment arrangements with the attorney acting on behalf of the Creditor whilst awaiting the Court date.
    1. Note: Ensure that these communications are in writing in order to avoid future disputes.


Should you ignore the summons, or have not received same seeing that you have moved and failed to inform the creditor hereof, the creditor will apply for default judgement 10 business days after the summons was served.

Default judgement in laymen’s terms means that you failed to respond to the summons, so it is assumed that you do not have any objection to this action.

Once a judgement is granted, the creditor will proceed to enforce the judgement and collect the outstanding debt. Should the credit agreement be a secured credit agreement, meaning for a house or car, the creditor will attach the property and sell same on auction to recover the outstanding debt.

Should the sale of the property not settle the total outstanding debt, the creditor will claim the shortfall from you as well. In the event that the credit agreement is for unsecured debt, the creditor may either attach your personal property or salary (garnishee order) to recover the outstanding debt.

Don’t Be Caught offguard

What often happens is that seeing the consumer failed to change the “domicilium” address with the creditor, legal action is instituted without the knowledge of the consumer and suddenly the Sheriff of the Court arrives at your place of work and demands possession of your vehicle.

This is why it is so important for consumers to update their addresses with credit providers and keep the proof of this communication.

Note: It is only the Sherriff of the Court that may demand to take possession of your vehicle. Often, certain agents acting on behalf of the creditors will intimidate consumers to hand over possession of their vehicle, or at times portray themselves as the Sherriff of the Court.

Always ask for proof of identification to ensure that the person is, in fact, the Sherriff of the Court. Should you hand over possession to a person other than the Sherriff it is considered Voluntary Surrendering in terms of Section 127 of the National Credit Act.