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What is a Section 129 Notice? And what happens next…

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South African woman reviewing and discussing Section 129 documents at a table

Things get serious the second a Section 129 Notice gets issued.

This could be the first sign that the court is about to get involved.

It’s not just a letter or a notice. It is a legal document. One that should be taken VERY seriously.

Here’s what you need to know.


Section 129 Notice

What is a Section 129 Notice?

A Section 129 Notice, often called a “Letter of Demand” or “S129 Letter of Demand,” is a formal notification. Creditors or debt collectors send an S129 Notice to consumers who fall behind on their monthly debt repayments.

The notice informs the consumer they’re behind and presents ways to solve the problem. If the consumer doesn’t respond or take any necessary action… then creditors may proceed to take legal action.

The legal background: The National Credit Act of South Africa regulates South Africa’s credit industry. It protects both consumers and financial institutions.

Section 129 of the National Credit Act (Part C: Required procedures before debt enforcement ) stipulates explicitly that a creditor must formally notify the debtor of their default and suggest possible ways to resolve the outstanding debt. Why? Because it ensures everyone is aware of the outstanding debt and that legal action may follow.


Section 129 Notice must Include the following information

A Section 129 Notice is a comprehensive legal document that must meet specific criteria to be considered valid.

The notice must include the following:

  • The consumer’s personal details: Your ID number and physical address.
  • Details of the Credit Agreement in default: The notice must clearly state which credit agreement is in default, including specific amounts due and the terms of payment.
  • Formal declaration: It must explicitly state that it is a “Notice in terms of Section 129 of the National Credit Act” to underline the legal basis and seriousness of the document.
  • Response period: You are given a 10-day period to respond to the notice. This should be written in the notice.
  • Options (including debt counselling [debt review]): The notice should mention that applying for debt counselling (debt review) is an option that helps resolve this issue. (More on this later.)


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How does the process work?

It goes like this. First, the consumer who owes money falls behind. Then, after the consumer has been in default for at least 20 business days… creditors may issue a Section 129 Notice.

Now, the debtor then has ten days to respond to the notice. This response can be an acknowledgement of the debt, a dispute of the claim, or a formally recognised debt counselling application.

Otherwise, the debt collection process continues.

When you get a Section 129 Notice, here’s how to handle it appropriately:

  1. Review the notice: Make sure all the information is correct, especially your personal details and the specifics of the credit agreement.
  2. Understand your options: You have 10 days to respond. During this period:
    • You can acknowledge the debt and present a plan to settle it on your own.
    • You can dispute the claim if you believe there is a mistake.
    • You can apply for debt counselling (debt review). Applying will help restructure your debt repayments to make it affordable. This will help you to settle the outstanding debt more comfortably. Plus, debt counselling offers legal protection. So you won’t have to worry about repossession or court orders.


What happens after a Section 129 Notice gets issued?

If you do not respond within the 10-day window, or if your response doesn’t resolve the issue, the creditor may take further legal action. Like taking the matter to court or initiating repossession proceedings. It’s important to act fast. Otherwise, things could get complicated and legal costs could start to pile up.

Here’s what could happen:

  • Legal proceedings: The creditor may initiate legal action to recover the debt, which could involve court cases.
  • The court allows creditors to settle the debt by taking your car, home, etc. (known as repossession): Depending on your agreement and the nature of the debt, repossession of assets might be initiated.


Immediate actions to take:

  • Respond quickly by discussing settlement, disputing the matter, or talking to a professional: It’s crucial to respond within 10 days to avoid more legal complications.
  • Seek professional advice: Consider talking to a financial professional (someone at My Debt Hero can help) or a lawyer to understand your rights and options.


Don’t just ignore it. It’s not something that goes away.

Here’s step-by-step guidance.


How to respond to a Section 129 Notice

Here are actionable steps a debtor (the consumer) can take.

How to respond to a Section 129 Notice:

  1. Review the notice carefully: Make sure all the information is correct. This includes personal details, the credit agreement in default, and the amounts claimed. If anything is incorrect, take note. It could be grounds for a dispute.
  2. Talk to a financial advisor or legal expert: It’s advisable to seek professional advice to understand the full implications of the notice and the best course of action based on individual circumstances.
  3. Consider debt counselling (debt review): This is a really effective solution. When you enter into debt counselling, also known as debt review. The risk of further legal action goes away. (As long as you do your part.) 
  4. Communicate with the creditor: Contact the creditor directly to discuss the notice and any possible arrangements for repayment. Creditors may offer more favourable terms or an alternative solution if you show that you’re willing to resolve the issue.
  5. Formal response: Formally respond to the notice within the 10-day window and outline what you are going to do. This could be disputing the claim, proving that you’re about to go through debt counselling, or proposing a repayment plan.


⭐ Check out some of our other posts to learn more about debt counselling (debt review):


In summary

Getting a Section 129 Notice is scary. Don’t freeze, and don’t ignore it.

It’s all part of a legal process, and consumers have options.

  • Respond appropriately: You’ll be off the hook soon and may even improve your finances in the process.
  • ⚠️ Fail to respond: You could lose your stuff and REALLY hurt your credit score. Defaulting is bad. Getting court orders or judgements is worse. It could take up to ten years to fix.


If you want a solution. Talk to our team at My Debt Hero. We can help.

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