Debt Review VS VDR (Voluntary Debt Restructuring)

Debt review vs VDR, what is the difference?

When you think of the challenges you are facing with your debt, you struggle to make sense of it all. The first thing is to know what is better for you and your family and when is debt review or VDR better for your situation. First let’s just understand each of these processes and how they work.


What is debt review.

Debt review is a formal legal process to help over-indebted consumers pay off their debt.

All your debt is consolidated into one affordable monthly payment. Lower interest of up to 0% is possible and your assets are protected against repossession from your creditors. You won’t be able to accumulate more debt while under debt review. This is for your own good and is to help you pay off your debt in the fastest time.

The process is fully confidential and once complete you are no longer over indebted and we provide you with a clearance certificate. You will then be officially debt free and be able to apply for new credit. An added benefit would be that you have a better credit score, resulting in possible lower interest rate.


When does debt review apply to me?

Your debt counsellor will recommend debt review to you when you are over indebted and you cannot afford your monthly payments. Common signs of this is that your loan application is getting declined, you are delaying payments, reversing of debit orders or are in arrears with your accounts.

Click here to learn more about Debt Review.


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What is VDR (Voluntary Debt Restructuring)?

As the name suggest, VDR is a similar process to debt Review. Your debt is also consolidated into one payment, but it is completely voluntary. VDR applies to you when your accounts are in arrears and you are likely to become over indebted but you want to prevent that from happening.

Because this is a Voluntary process. You have the option to exclude some of your debt. But something to take note of, is that with VDR you can’t include your secure debt. Secure debt includes things like your home and car finance. Only unsecured debt can be consolidated under VDR, like personal loans, credit cards, and store cards.

You get the benefit of a lower payment of up to 50%. This allows you to better manage your day to day living expenses. Note that unlike debt review, your assets will not be protected against creditors action of repossessing it.


When does VDR apply to me?

This process applies when you want to make your life easier by consolidating some of your debt. Especially when you are in a tight money situation accompanied by the early over indebtedness indicators like skipping a payment or two, missing debit order due dates and feeling the stress of meeting your financial obligations.

For example: When you wish to combine your loan from two different banks, while keeping your credit card, then VDR is for you!

The VDR process improves your credit score and helps you become credit clear without judgements. Especially when your loan applications were declined. This is a massive benefit!

For example:  You need more money to pay your child’s school fees next month. Your application for a loan at the bank, to cover unforeseen costs, gets declined “due to affordability” The VDR process will give you the extra money you want.

Note as VDR is voluntary you can exit the process at any time.


In the end Debt Review vs VDR. They are both two debt counselling processes that each have their own benefits. VDR is perfect if you want to consolidate some of your debt to help you cope with your debt. VDR allows you to exit the process at any time, which makes it a great financial tool. You can use it whenever you need it.  Voluntary!

Debt Review is ideal when you are or will become over indebted, you need a high level of debt relief and need to protect your assets against repossession. This process is formal and a court order will be issued to state the new payment agreements. With this in place your assets are protected.

Note that in terms of costs the Debt Review is one of the cheapest financial debt relief options available in the market, if not the cheapest. It is even more affordable than a loan!


With today’s uncertainty in South Africa’s economy you cannot allow your debts to get away from you. Get assistance before it is too late. FINANCIAL FREEDOM IS ONLY A FEW STEPS AWAY!  Contact us now for an obligation free assessment and let us expertly guide you get to a better financial future.

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