When should you resort to getting debt counselling?

[Dave A]

Also there is the new and improved in duplum rule. It says that a consumer's total debt (interest + charges) shall not exceed the outstanding principle debt at the date of default. If you consider the interest paid on a normal mortgage agreement, then the implications of this rule are simply huge. It is being contested in the Supreme Court of Appeal, however, if the appeal fails this is going to be a ruling of major significance in all of our lives. Should you go under debt review, you would qualify for this rule and it could cut your debt by more than half.

If I understand what you are suggesting here correctly (essentially, interest and charges may not exceed the capital over the term of the loan), there could be massive implications - particularly for long term loans such as bonds over property.

While this might seem to the benefit of the consumer, I see a massive danger here.

Banks are bound to change their product to cover the situation, which in turn could actually be harmful to the consumer in the long run. The period of the bond would bound to be reduced; perhaps it will be like car finance with a residual. The consumer will then be faced with refinancing at this point, with all the contingent costs that can go with that.