by Marcel Jude Joseph
Posted on 17 January 2011 in www.theborneopost.com
In last week’s column, I talked about credit card debt and the AKPK, Malaysia’s debt management system for those in serious financial predicament.
I was taken aback when I got over 600 responses from Sabah and Sarawak by email and SMS from those who were in financial predicaments and were interested in the services of AKPK.
I believe that this is the tip of the iceberg and today’s article is for those who want to know more about how to use the services of AKPK. Instead of a technical explanation, I shall use the testimony of one Mrs Peh Peng (name changed).
My experience with AKPK
I am officially under Malaysia’s AKPK’s debt management programme.
What a relief! No more haunting calls and notices from banks from now on. No more exorbitant late payment charges. Yes, I am under AKPK’s debt management programme, which helps me restructure my credit card debt.
Let me share with you my bumpy journey from getting to know AKPK from the television to being approved to be under the debt management programme.
I first came to know about AKPK (Agensi Kaunseling Dan Pengurusan Kredit or Credit Counselling and Debt Management Agency) in April. AKPK’s advertisement appeared very, very often during that time.
The next day, I went to AKPK’s website to find out more information. The first thing I wanted to know about AKPK was whether it was legitimate or not. AKPK is an agency set up by Bank Negara Malaysia in April 2006 to provide financial counselling and debt management to individuals as well as financial education to help individuals take control of their financial situation and gain the peace of mind that comes from the wise use of credit.
After making sure that AKPK was set up by Bank Negara, I was relieved. I was even more relieved when I knew that it’s FREE. Yes it’s FREE
I didn’t visit the nearest agency at my place during that time because I thought I could still manage my credit card debt and I didn’t have to resort to any debt repayment plan.
When did I decide to apply for the debt management programme? I made up my mind when Bank Negara changed the late payment penalty charge policy. The late payment penalty charge policy was revised to a minimum of RM10 or 1 per cent of total outstanding balance.
I used to pay RM5 or RM10 for my late payment fees. But after the change of BNM policy, I had to pay RM30, RM40 or more for the late payment charges. Bear in mind that I had more than six credit card payments to pay every month and I was always late in paying.
I couldn’t take it any more. I felt suffocated by the accumulating credit card debt caused by the finance charges and late payment fees.
So, in August, I made an appointment with one of the AKPK counsellors at Ipoh branch.
All in all, I dropped by at least three times before I successfully submitted my debt management programme application.
The first time I paid a visit, I didn’t bring my payslips or income statements to prove that I made a certain amount of income every month. I don’t have any payslips because I am working online. I make money from the Internet.
You must have pay slips or income statements or evidence of income.
If you have no payslip or income statement, the counsellor will not give you the application form at all. He will not let you apply if he knows that your application will not be approved.
You have only ONE chance to apply for the debt management programme. Everyone has only ONE chance for this debt management programme. Because of this reason, the debt management counsellor is very strict. He wants to make sure that you have all the necessary documents so that your debt management programme application will be approved.
• You have a positive source of income after meeting your expenses.
• Your total debt does not exceed RM2 million.
• You are not under advanced litigation process.
• You are not a bankrupt.
My first visit to AKPK was not a success because I didn’t bring my payslips or income statements. I am self-employed and I don’t prepare payslips for myself.
Fortunately, the credit counsellor asked me if I had any proof to show that I made money online and I transferred my money to local banks. Yes, I could prove it. I printed out my PayPal statement that showed every PayPal withdrawal I made into my Tune Money Visa debit card. I also requested a hard copy of the transaction statement from Tune Money.
The counsellor was surprised that people could actually make money online. I was relieved that he accepted my online income proof too.
If you have payslip or income statement, your journey will be less bumpy than mine. You must have a positive source of income after meeting your expenses.
In my case, my monthly income is RM3,500. My expenses include RM820 car loan instalment, RM605 home loan instalment, RM800 groceries, RM400 petrol and car maintenance, RM180 bank overdraft interest charge and RM375 miscellaneous spending.
RM3,500 — RM3,180 = RM320
This RM320 is my monthly debt repayment made to AKPK and AKPK is in charge of distributing the money to various banks. In my case, there are six banks. Two banks get RM60 each and four banks get RM50 each every month until I settle the credit card debt.
So, it’s important that you have a positive source of income after deducting your expenses.
For me, I didn’t give up my house and car. You can choose to give up your house and car together with your credit card debt if you really, really can’t make payments for your house and car loan.
The second visit was also not a success because I thought of keeping one credit card for emergency use. I was not told that I must give up all my credit cards during my first visit.
If you are thinking of applying for the debt management programme, you must give up all your existing credit cards.
If your debt repayment plan is approved, you won’t be able to apply for any new credit card or loan for the next few years unless you fully settle your debt. Banks will not approve any new credit card or loan you apply for in future once you are under the AKPK debt management programme.
Who cares? I just want to pay off my credit card debt with one payment to one agency on one date. I don’t mind not being given any new credit card or personal loan in future.
I am grateful that I am under the AKPK debt management programme with God’s help. With only one payment to one agency on one date, I can now sleep well at night and focus on building up my online business slowly.
In brief, the percentage of getting your debt management programme approved is high if:
• You have payslip or income statement or evidence of income;
• You have a positive source of income after meeting your expenses;
• Your total debt does not exceed RM2 million.
• You are not under advanced litigation process; and
• You are not a bankrupt.
Don’t wait any longer. Pick up your phone and call AKPK for an appointment. Get all your questions answered there and submit your debt management programme application. It takes three months to process your application, so start as early as possible.
Let me repeat again, it’s free.
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