The Debt Review Process Explained: Form 16, 17.1, 17.2 and the Court Order
OurPower - Last verified 2026-08-15 against the National Credit Act 34 of 2005 and its regulations
The forms, and what each one actually does
The process runs on four prescribed forms. Knowing which one is due when is how you hold a debt counsellor to the timeline.
- Form 16 - the application itself, under section 86(1). Personal details, income, deductions, every debt, living expenses, a declaration committing to the restructuring, and consent for a credit bureau check. The fee addendum attaches here.
- Form 17.1 - notification, under section 86(4)(b). Goes to every credit provider you listed and every registered credit bureau within 5 business days of your application. It asks your credit providers for certificates of balance.
- Form 17.2 - notification of the determination. Goes to all affected credit providers and all registered credit bureaux within 5 business days after the assessment is complete.
- Form 18 - the application to court under section 86(9), used when a debt counsellor has rejected you and you go to the Magistrate's Court yourself.
- Form 19 - the clearance certificate, issued at the end under section 71.
Stage 1: application and notification
You submit Form 16 with supporting documents and pay the R50 application fee. Section 86(4) then requires the debt counsellor to give you proof of receipt and to notify all listed credit providers and every registered credit bureau.
Regulation 24(2) puts a 5 business day clock on the Form 17.1 notification, and regulation 24(5) requires it to be sent by fax, registered mail or email, with the debt counsellor keeping a record of the date, time and manner of delivery. That record is your evidence if a credit provider later claims it never received notice.
This notification is what switches on the section 88(3) protection against enforcement. It is why the 5 day deadline matters so much.
Stage 2: verification and assessment
The debt counsellor verifies what you declared, by asking you for documentary proof, contacting your credit providers or your employer, or any other method of verification. Regulation 24(4) contains a useful rule in your favour: if a credit provider fails to provide corrected information within 5 business days of verification being requested, the debt counsellor may accept your figures as correct.
The assessment applies regulation 24(7). Net income is your gross income less statutory deductions and other deductions made as a condition of employment. Minimum living expenses are based on the budget you provided, adjusted by the debt counsellor with reference to NCR guidelines. If your total monthly debt payments exceed net income minus minimum living expenses, that is the arithmetic indicator of over-indebtedness.
The word 'adjusted' is doing real work in that sentence. Your living expense figure is a starting point, not the final one, and a debt counsellor may bring it down. That is the single most common surprise in the assessment.
Regulation 24(6) gives 30 business days from receipt of the application for the section 86(6) determination.
Stage 3: one of three outcomes
Section 86(7) allows exactly three findings.
- Section 86(7)(a) - you are not over-indebted. The debt counsellor must reject the application, even if they concluded a particular agreement was reckless when it was entered into. You get a letter of rejection setting out the basis, including the income, deductions, living expenses and other debt considered, plus a copy of the assessment form.
- Section 86(7)(b) - you are not over-indebted but are experiencing, or likely to experience, difficulty meeting all your obligations on time. The debt counsellor may recommend that you and your credit providers voluntarily agree a re-arrangement plan.
- Section 86(7)(c) - you are over-indebted. The debt counsellor may issue a proposal recommending that the Magistrate's Court re-arrange your obligations, and declare agreements reckless where that applies.
Stage 4: consent order, or referral to court
Where a section 86(7)(b) recommendation is made and you and every credit provider concerned accept the proposal, section 86(8)(a) says the debt counsellor records the proposal as an order and files it as a consent order under section 138. That is the fast, cheap path, and it is why the NCR fee guideline sets a lower legal fee of R750 for a consent order.
If even one credit provider does not accept, section 86(8)(b) requires the debt counsellor to refer the matter to the Magistrate's Court with the recommendation. That is slower and the legal costs must be separately negotiated with you.
What the court can order is limited to section 86(7)(c)(ii): extending the period of an agreement and reducing each payment accordingly, postponing payment dates for a specified period, doing both, or recalculating your obligations because of contraventions of the Act.
Stage 5: if you are rejected
A rejection is not the end, but it starts a short clock. Regulation 25(5) requires the letter of rejection to advise you of your right to approach the court under section 86(9) within 20 business days, and regulation 26(1) requires that application to be submitted to court within 20 business days of the rejection letter. Section 86(9) requires the leave of the Magistrate's Court to apply directly.
Regulation 25(6) requires the letter to warn you of something else: the application is removed from all registered credit bureaux within 5 business days, which means your credit providers become entitled to take legal steps against you again. The section 88(3) shield drops. If you intend to go to court yourself, move quickly.
Stage 6: paying, and finishing
Under an order or agreement you make one monthly payment, which a Payment Distribution Agency splits among your credit providers. The PDA charges its own monthly fee, separate from the debt counsellor's aftercare fee.
When you have satisfied the re-arrangement, section 71(1) requires the debt counsellor to issue a clearance certificate within seven days, and section 71(4)(a) requires a certified copy to be filed with the national register and all registered credit bureaux within a further seven days. That is what gets the record expunged. See our clearance certificate guide: /tools/debt-review/clearance-certificate-form-19
Frequently asked questions
How long does the whole process take?
The assessment stage is bounded by regulation at 30 business days. The repayment period is whatever the re-arrangement sets, which depends on how much you owe and what you can afford - commonly several years. There is no statutory maximum length for a re-arrangement, and anyone quoting you a fixed number of years before assessing your file is guessing.
Do all my credit providers have to agree?
For a consent order under section 86(8)(a), yes - you and each credit provider concerned must accept the proposal. If they do not, the matter goes to the Magistrate's Court under section 86(8)(b), which can make the order without unanimous consent.
What is a PDA?
A Payment Distribution Agency. You pay it once a month and it distributes to your credit providers according to the plan. It charges a monthly fee that is separate from your debt counsellor's fees, so make sure you know both figures.
Can the plan be changed later if my income drops?
Aftercare, as described in the NCR fee guideline, includes an annual review of your financial position and any dramatic change in circumstances that affects your ability to repay under the accepted plan and court order. Tell your debt counsellor about an income change immediately rather than simply underpaying, because defaulting on the re-arrangement is one of the events that lifts the section 88(3) protection.
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OurPower is not a debt counsellor and is not registered with the National Credit Regulator. This page is general information about South African debt review law, not financial, legal or debt counselling advice. Debt review is not the right answer for everyone. Only an NCR-registered debt counsellor or a court can determine whether you are over-indebted. Legislation verified 2026-08-15. Sources: National Credit Act 34 of 2005 (as amended), the National Credit Regulations, the NCR Debt Counselling Fee Guidelines, and the NCR.