Skip to content
English
Log a ticket
  • There are no suggestions because the search field is empty.

What are the steps involved in the Asset Repossession process?

Asset Repossession whilst under Debt Counselling

 

Table of Contents

What happens before an Asset is Repossessed

What happens after your asset has been repossessed?

 

Before a credit provider can repossess an asset, a few steps need to be followed on the credit provider’s end.

  1. Assets can be repossessed if a consumer defaults in payment.
  2. A credit provider will issue an S129 letter. An S129 letter is a notice to inform the consumer that their account is in arrears and provides a time frame of 10 business days for the consumer to remedy the situation by either settling the arrears or make a payment arrangement with the credit provider.
  3. Should the consumer not make use of the 10 business days, the credit provider will terminate the account from debt counseling. Resulting in the cancellation of the payment arrangement made under debt counseling, and the original agreement coming into effect with accumulated arrears.
  4. Once the account is terminated from debt counseling, the credit provider will approach the courts for a summons. A summons is the first official document in the court process of South Africa. It will stipulate specifics of the case, such as: who the credit provider is, what the claim is, etc. The summons will also contain a Notice of Intention to Defend. You must respond with the Notice of Intention to Defend yourself within 10 days. If you do not respond to the summons, the Plaintiff’s lawyer can request a default judgment.
  5. The next step would be for the credit provider to obtain a Court Order/Warrant of Execution. This will allow the credit provider to take back possession of the asset.



Please  Note:

  1. Only a Sheriff of the court may repossess your asset and must provide proof of the court order. 
  2. Where the Sheriff of the court has produced identification and a copy of the court order, you must release the asset, or you can be held in contempt of court and be arrested.
  3. If the person collecting your asset does not provide identification showing that they are the Sheriff of the court as well as a copy of the court order, most likely it is a collection agent trying to get you to voluntarily surrender the asset. In this scenario, you are under no obligation to sign any forms usually known as a Consent to Voluntarily Surrender and hand the asset over.
  4. At this point, it is best to get in contact with the credit provider and request for a payment arrangement to be drawn up for the arrears to be settled.

     

    What happens after your asset has been repossessed?

    1. The credit provider will take possession of the asset and keep it in storage until such a time that it is scheduled for auction.
    2. You will be liable for storage and administration fees during this period.
    3. Once the asset has been auctioned, the credit provider will calculate whether there is still a balance owing on the asset or not.
    4. Should there still be an outstanding balance on the asset also known as a Shortfall, you will be liable to settle the shortfall amount. In most cases, no interest is charged on a shortfall amount.