Administration Order in South Africa

What is an administration order?

Administration order is an order made by a Magistrate’s Court setting out different amounts that a person (“debtor”) must pay towards his/her outstanding debt with one or more persons (“creditor(s)”).

How long does an administration order last in South Africa?

According to the National Credit Act 34 of 2005, an administration order reflects on one’s credit report for a mandatory period of 10 years.

What are the disadvantages of an administration order?

The court may not grant the order as it is subject to individual circumstances. You will be subject to a monthly charge of 10% of your repayments by the court for supervising the order. You will be unable to obtain further credit during the order.

Who can apply for an administration order?

A debtor whose outstanding debt is less than R50 000 in total, is struggling to pay it off and does not want to undergo sequestration.

How is an application for an administration order made?

• A debtor must apply to a Magistrate’s Court in the area where s/he resides, carries on business or is employed.
• The application must be made in the prescribed form, which can be obtained from the clerk of a Magistrate’s Court. The form will include an affidavit made by the debtor and must be accompanied by a statement of his/her financial affairs.
• The clerk of the Magistrate’s Court will provide a date by when the application will be heard.
• A copy of the application and supporting documents must be delivered to every creditor of the debtor, in person or by registered post, at least three days before the date of the hearing of the application. A creditor may object to the application or the granting of an administration order.