What is Financial Rehabilitation

A Consumer that has Sequestrated can apply to Court for Financial Rehabilitation 48 months after the date of provisional Sequestration. In some instances the Insolvent can apply sooner for Rehabilitation.


 What is Financial Rehabilitation? 

An insolvent can apply to Court for Rehabilitation 4 years after the date of provisional Sequestration. In some instances the Insolvent can apply sooner. There are 7 Sections in the Insolvency Act with 8 circumstances under which you can Rehabilitate. Each of these instances has it's own time frame. An insolvent is automatically rehabilitated after a period of 10 years has expired from date of Sequestration.   

 Financial Rehabilitation Process 


1. Required Documentation

  • The sequestration order

  • Certificate of appointment of curator

  • The Article 81 report

  • The first and final Liquidation and Distribution account (L & D)

  • Enforced letter in respect of the first and final Liquidation and Distribution account

  • Date when the first and final Liquidation account was enforced by the Master of the High Court.


2. Notice in the Government Gazette

When we receive the relevant documents a notice is published in the Government Gazette and an affidavit is drafted for the clients signature before a Commissioner of Oaths.

3. Permission for the Rehabilitation to be lodged

A report is requested from the Curator and the Master of the High Court, which gives permission for a Rehabilitation application to be lodged. The report from the Master can take anything from two weeks to three months to obtain and is necessary before we can proceed with the application.

4. Application  presented on your behalf

An Advocate will present the application on your behalf. There is no need for you to attend the court hearing in person. We will notify you of the outcome. A court order will be granted within 10 to 15 days.

5. ITC Clearance

The court order is then sent to the credit bureau along with the rehabilitation order, sequestration order, certified copy of client's Identity document and the statement of Debtor’s affairs (list of Credit Providers).

6. Timeframe for Clearance

It takes approximately 21 days to update the Credit Bureau's records. There are instances where it can take longer. We will discuss this with you at the time of the Rehabilitation application.

 Benefits of Financial Rehabilitation 


1. Financially independent again

Rehabilitation puts an end to your status as an insolvent which would have arisen when you were sequestrated and allows you to effectively exit Sequestration.


2. Credit Report Staus is updated

All adverse listings are cleared from your credit report and you are once again able to obtain credit responsibly.

 Disadvantages of Financial Rehabilitation 

1. Obtaining Credit

In some instances the FInancial Institutions that lost money in your Sequestration are often difficult. However, you can apply for credit with institutions who did not form part of your insolvent estate as they will normally help you. Some Credit Providers might want you to go through a “probation” period, to determine how you deal with accounts they open for you. Take credit responsibly and pay your installments on time every month until you have built up a good relationship with your Credit Providers again.


2. Rehabilitation Notice on your Credit Report

The Rehabilitation Notice will remain on your credit report for 5 years.

 Cost of Financial Rehabilitation 

It costs R12,000.00 to Rehabilitate. An arrangement can be made to pay this fee over 3 months @ R4,000.00 per month.

  Financial Rehabilitation - Frequently Asked Questions 

1. Must I repay my debts before I can apply for rehabilitation?

No. When you are sequestrated your debt is "written off". None of your old Credit Providers can ever force you to pay back the old debt. In legal terms your debt is not written off, it vests in a trustee who must realise the assets and distribute the yield of the sale of the assets amongst Credit Providers in accordance to Insolvency Act.


2. Which Court has jurisdiction to rehabilitate me?

Only the Court that gave the Sequestration order. There are a few exceptions on which we will advise you.


3. Who has the responsibility to remove my adverse credit information at the Credit bureaus?

Once the court grants your Rehabilitation order, the Registrar of the High Court must despatch a copy of the order to the credit bureaus who must then remove your adverse credit information. As a back up we will also follow through with the necessary documentation to clear your credit report of adverse listings. According to the rules of the credit bureaus, if no one objects to the removal of your name from the credit bureau within twenty one days, they must remove all adverse information that arose before the date of your Sequestration. It sometimes happens that a Credit Provider has taken judgement against you after you have been Sequestrated. The credit bureaus then refuse to remove the judgements that were taken after Sequestration unless they receive a letter from the Credit Provider stating that the debt was incurred before Sequestration. The removal of adverse listings is meant to take 30 days. In instances where Credit Providers obtained judgements after the Sequestration date, removing adverse listings could take as long as 3 months to rectify.

 Contact Us 

Contact Number:

011 504 2914


Mobile Number

061 487 2122




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