Does it cost money?
Yes, the costs are:
Administrator’s fees – to apply for the administration order (you only pay this once);
Administrator’s fees – to assist you to pay your creditors (you pay this every month, and the amount is capped at 12,5 % of the amount collected);
Employer’s fee (5%) – if your employer has to deduct money for creditors from your salary before you get paid (these deductions are called emolument attachment orders); and
Interest on the debts that you owe to creditors.
Who can apply for an
administration order?
If your debts are R50,000 or less – and
you have no assets that can be sold to pay back the debt – then Section 74 of
the Magistrate’s Court Act allows you to apply to the court for an
administration order. This order will temporarily protect you from your
creditors and enforces a repayment plan that enables you to repay you debts
while still keeping some money for your basic living costs.
Do you really need an administration
order?
It is very important to work out whether or an administration
order is the right solution for your debt problems, before your rush into it.
The question to ask is:
Will administration put you in a better position
than before – with your debts paid off in a reasonable time – or will you end up
with more debt than before?
