The country’s leading and largest debt counsellor, DebtBusters, says consumers should be sensible in taking on further debt even though a debt relief bill has now been signed into law.

Benay Sager, DebtBusters’ Chief Operating Officer, says that while there is a real need to help low-income consumers who are overburdened by debt, there are still many unanswered questions about how the new law will work practically.

“It will take some time, possibly up to 24 months, for regulations to be finalised so the law can be implemented. Taking out more credit than you can afford in the meanwhile isn’t a good idea and could have long-term implications for your credit record.”

He says consumers should also be aware that the new law only applies to people in a particular income group, meeting specific criteria and that the debt relief is not automatic.

Consumers will need to qualify and then submit to a process before some or all of their debt can be written off.

“There is a genuine need to help low income consumers who are over-indebted and who cannot pay back their debt,” says Sager. “But based on over 10 years’ experience helping this client segment, we know that good counselling needs to be part of the process so over-indebted people don’t find themselves back in the same position again.”