Garnishee order leads to borrower overpaying loan

Serving a garnishee order is quite expansive. If you can, try as much as possible to avoid your salary being garnished.

John Ntshalinsthali took a loan of R20000, but he ended up paying R55 802.

This included attorneys fees, interest and five percent commission his employer is entitled to deduct for their administration in terms of the emolument attachment order.

He had also overpaid his debt because his employer did not stop the debit order after the debt was paid in full, he said.

But last Friday he sang songs of praise after Consumer Line assisted him in recovering his R4639 which he had overpaid to African Bank's attorneys who had garnished his salary.

He also blamed his HR department for continuing to pay the bank's attorneys when he had repaid his debt in full.

"They continued to debit my salary because they were getting five percent commission, and stopping would mean a loss to them," he said.

Ntshalintshali took a loan of R20000 plus insurance from Saambou Bank, which was later taken over by African Bank.

He had to repay it in instalments of R1070 over 36 months without default. In total he had to repay a total of R38550,96.

Ntshalintshali said after Saambou was liquidated, he did not know where to repay his loan, but resumed paying his debt when African Bank's attorneys demanded payment.

They had attached a garnishee order against his salary in an amount of R1220.

After paying the full debt, the bank's attorneys continued to accept payment from his employer.

He notified them and after complaining, the attorneys wrote a letter to his employers ordering them to stop debiting his salary since he had repaid the debt in full, but they did not.

"We sometimes accuse debt collectors for debiting our salaries continuously when our HR departments are the ones to blame, and it is frustrating when they pass the buck to the collectors, who have notified them to stop the deductions," he said.

Marilyn Budow, the consumer advocate at African Bank, confirmed they had received four more instalments from Ntshalintshali after he had paid his debt in full.

She said a judgment was taken against Ntshalintshali after he had defaulted to repay his loan for a period of three years.

During the time judgment was taken, he owed R23 077,37 plus interest at 20 percent yearly in addition to legal costs.

"It is an unfortunate fact that when a consumer defaults on a loan for a long period of time, the total amount to be repaid is considerable and once judgment is taken, there are addition legal costs as well," said Budow.

Ntshalintshali confirmed he was refunded his money last Friday.