In OR out of Community of Property? Hopefully, this is a topic that gets discussed, debated and argued about whenever someone gets engaged. “Why hopefully”? I hear you ask. Because it is important and can impact your financial future. Also, far too many people don’t like talking about money, so they don’t. Yes, this is a mistake and can have long-lasting consequences. So, let us delve into this topic and get you some answers to the question – Debt Review and how being married In OR out of Community Of Property affects it?
In South Africa, there are 4-types of marriages that are managed by the Department of Home Affairs and they are:
Civil Marriage
Civil Union
Customary Marriage
Religious Marriage
Civil Marriage
Civil Marriage is the most common type of marriage in South Africa.
There are 3-types of Civil Marriages:
In Community of Property
Out of Community of Property with Accrual
Out of Community of Property with the Accrual Systems Exclusion
A Civil Marriage will automatically be In Community of Property unless the parties enter into an antenuptial contract. Once the you and your soon to be spouse have got an antenuptial contract, it is considered to be Out of Community of Property – with or without the accrual system.
For this article, we will only focus on IN and OUT of Community of Property. We will not focus on the Accrual system at all as this has no impact on Debt Review. All that applies to the Debt Review process is whether you are married IN or OUT of Community of Property.
Civil Union
This is a marriage between two people and includes people of the same sex. As with a Civil Marriage, a Civil Union is automatically considered to be In Community of Property unless it is accompanied by an antenuptial contract.
Customary Marriage
A Customary Marriage is a union, negotiated and celebrated according to the customary law within the community. Customary Marriage is considered a valid marriage, whether it is monogamous or polygamous. However, if it is polygamous, the husband must apply to the High Court for permission to enter into this type of marriage. This application must include a written contract stating how the property in the marriage will be regulated.
A Customary Marriage is automatically considered to be In Community of Property unless it is accompanied by an antenuptial contract.
Religious Marriage
Religious marriage is a union that is entered into in terms of a religion, such as:
Hindu Faith
Islamic Faith
A Religious Marriage is not recognised by law and offers limited protection. A Religious Marriage is automatically treated as Out of Community of property without the accrual system.
What Is Debt Review?
Debt Review, also known as Debt Counselling, Debt Consolidation or Debt Rescue, is a way to assist over-indebted South African citizens to get out of debt. A Debt Counsellor assists you by negotiating with your creditors to reduce your monthly debt payments while ensuring that you are financially capable of taking care of your living expenses.
Am I Over-Indebted?
Not sure you are over-indebted? If you find yourself in these situations, you should consider speaking to one of our professional Debt Counsellors:
You do NOT pay your monthly debts on time as agreed with your creditors
You need to use an overdraft or credit card to pay your debts and buy food and other necessities
You borrow money to pay your debt
You do not make all your monthly payments to some OR all of your creditors
You receive letters of demand from creditors and lawyers
Does My Spouse Have To Go Under Debt Review With Me?
This is where we get to the reason you are reading this article.
First the short answer:
If you are married Out of Community of Property, the answer is No.
If you are married In Community of Property, the answer is Yes.
Let me explain.
Out Of Community Of Property
If you are married Out of Community of Property your ‘estate’ is NOT jointly owned. This means that, as far as the law is concerned, you and your spouse own everything within the marriage separately.
Should you be married Out of Community of Property you can apply for Debt Review without your spouse having to go through the process too. Your spouse’s financial situation will also not be impacted by you being under Debt Review.
In Community Of Property
When married In Community of Property, you and your spouse are seen as one legal entity and your ‘estate’ is jointly owned. Therefore, if one of you is over-indebted, both of you are over-indebted. There is no separation when it comes to you and your spouse.
This is the main reason couples have antenuptial contracts drawn up, not just drawn up because they may get divorced someday. An antenuptial contract protects a spouse against their partner’s debts.
If you are married In Community of Property (no antenuptial contract) your spouse has to sign up for Debt Review with you. You will both be flagged as under Debt Review with the NCR and credit bureaus. Both, you and your spouse, will be flagged until the Debt Review process is completed successfully.
It Is Not All Moonshine And Roses
Should you find yourself in a situation where you are no longer able to pay all your debts, talk to your spouse. Delaying this will only ensure that the situation gets worse. The benefit of being married In Community of Property is that as soon as your spouse’s income is added to the Debt Review process, it can greatly affect your ability to pay your debt off faster.
I hope that you have found the answers you are looking for regarding Debt Review – In or Out of Community of Property. If you have any further questions, contact one of our professional Debt Counsellors and they will assist you right away.
