Can you open a new bank account if you are under debt review?
Yes, not only can you open a new bank account when you’re under debt review (debt counselling), you should.
Why do I need to open a new account with debt review?
The reason this is so important is to ensure that you are not double-debited.
Even though we do our utmost to handle all communication with creditors, to ensure that all areas are covered and that you are not mistakenly double-debited, we strongly encourage all our debt review clients to open a new bank account to prevent your creditors from money grabbing.
Remember, opening a new bank account such as a current (cheque) or savings account is not the same as applying for credit. Unlike with applying for new credit, you are able to do so when you’re under debt review.
Does opening a bank account affect your credit score?
A current, cheque or savings account should not affect your credit score unless a hard inquiry is done into your credit report. A hard inquiry is usually done when you are applying for credit. Since these bank accounts are seen as more money management accounts, a hard inquiry should not be done into your credit report.
The three accounts that can be found on your credit report
There are three account-types that can be found on your credit report. These are:
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Installment accounts
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Examples of these accounts are: home loans, car financing, student loans and personal loans.
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Revolving accounts
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Examples of these accounts are: credit cards and personal lines of credit including payment options like Buy Now, Pay Later (BNPL) methods.
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Collection accounts
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This is when you are behind on payments and your account has been sold or sent to a debt collection agency.
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Which bank can help with debt review?
Banks don’t offer debt review, but they do have debt review departments that deal with the processing of the negotiations for your new interest rates on your loans.
Remember, if you have a home loan or personal loans with a bank, they are the creditor we negotiate with on your behalf.
Is there a downside to opening a new bank account?
No, you just have to be aware of the bank accounts you have, the reason for having each of them, and the monthly admin fees associated with each of the accounts.
Having too many bank accounts just for the sake of having them is not ideal either.
How long will my bank account be under review?
The time your loans will be under the debt review process will depend on how much debt you have and what the repayment term is. All of these details will be given to you at the beginning of your debt review journey when your Debt Counsellor discusses your new proposed repayment plan with you.
How do I get out of debt review without paying?
You can’t get out of debt review without paying. Just as there is no such thing as a ‘get- rich-quick’ scheme, there is no such thing as a ‘get-out-of-debt-without-paying’ option.
Getting out of debt will require discipline and patience. If you practice having these, you will be successful on your debt-free journey.
If you partner with Meerkat, you also won’t be alone on this journey. We ensure you feel supported when you’re signing up as a client and throughout your entire debt review journey.
How do I get out of debt review quickly?
If you have paid up all your debts, and for some reason you can’t contact your Debt Counsellor, we can get you out of debt review quickly. We do this completely online and can speedily issue you a clearance certificate so that you can legally exit the debt review process.
How can I speed up my debt review?
While you can’t get out debt review without paying up all your debt, you can speed up the time spent under debt review. You can do this by increasing your monthly payment for debt review. This will decrease your repayment term, and may even decrease your total debt amount.
Can I apply for credit after debt review?
You can apply for credit after you’ve successfully completed the process. Once you've successfully completed the debt review process, we will contact the credit bureaus so that they can update your credit report and remove the debt review flag. This will then indicate to future creditors that you are eligible for applying for credit again.
It's important, however, to note that after completing the process, you will first have to work on building up your credit score again before you will be granted credit.
When going under debt review, think of it as an opportunity to clear your credit score. With debt review, you are given a clean credit slate. After which, you will need to slowly build up your credit again by opening a retail or store account, for example.