A credit provider cannot enter into a careless credit contract with a consumer. Before entering into a credit contract, a credit provider must first take appropriate steps to assess the consumer Section 89, which lists a number of credit contracts that are illegal, including over-indebtedness by a consumer, when available information indicates that the consumer is unable to pay in a timely manner the amounts owed under a credit contract. In deciding whether a consumer is over-indebted or not, a court must consider the consumer`s terms for an agreement to constitute a credit contract, borrow money, defer payment of an amount owed by one person to another person and collect interest, since interest is the cost of the privilege of borrowing money. The NCA is applicable to any credit contract concluded or effective in South Africa, provided there is no exclusion. Overall, the strength of the national credit regulator, the extensive powers of the National Consumer Court and the courts, the almost paternalistic tendency of lawmaker protection and the vast network of dispute settlement accounts for consumer legislation, which will have a huge impact on the huge credit industry in South Africa.  As a general rule, a lender asks the court for a “precautionary seizure order” until the contract is terminated, in order to protect endangered goods (such as a motor vehicle) from deterioration or deterioration. This order will allow the sheriff to place the goods on deposit until the legal action is closed, which can take a long time. The law does not specify whether lenders can still obtain interim foreclosure orders. The current practice of obtaining such contracts may continue. If a credit provider correctly terminates a credit contract, the court can order the seizure of the goods, so that for the sale of the goods the account to be settled. This procedure follows the usual common law.
The National Credit Act is a complex and time-consuming law that attempts to regulate precisely every consumer credit sector. The final provisions of the Act will come into force on June 1, 2007. The Act repealed the Usury Act and the Credit Agreements Act and bears little resemblance to these statutes. It`s a clear break with the past.