There are countless stories of responsible citizens who apply for credit and then discover to their horror that they’ve been blacklisted. How does it happen and how can the situation be reversed?
Fortunately, blacklisting affects fewer than 20 percent of South Africans, but it’s a good idea to do a credit check on yourself from time to time. TransUnion ITC offers a once-a-year check for free. Log onto www.mycredit.co.za for more information. They’ll also ensure that no-one else can view it by sending you a password to access your report.
How do you get listed?
A default can be listed on your record by your credit provider. This could be because you’re a slow payer or because an asset has been repossessed. The listing helps other credit providers to understand your financial health. A judgment can only be listed on your record once a credit provider has taken legal action against you. A judgment is an order from the court, ordering you to pay your debt. It can stay on your record for as long as five years — even after you’ve settled the oustanding amount.
Should you have a judgment, contact the credit provider, provide them with proof of payment and request a removal. They might assist you, but it’s at their discretion.
How can I ensure that I don’t get blacklisted?
Pay accounts punctually.
Check your credit reports. If you find inaccuracies, contact TransUnion, and provide with them with documents proving your bills were paid on time. They’ll contact the credit provider, confirm the error, and correct your report.
Manage your debts. Keep your credit balances well below your available facilities.
Don’t apply for too much credit. Too many applications reflects poorly on your record and lowers your score.
Can I do a credit check on a potential tenant?
Generally, private individuals aren’t allowed to do checks on other individuals, but your estate agent can do one. However, the tenant should sign a credit authorisation document provided by the estate agent.
If you lease your property privately, you can contact a rental services company like Tenant Profile Network to assist you (at a small cost), but you need written authorisation from the tenant.
How do I maintain a good credit record?
Research your credit options (rates, fees and terms) and don’t grab the first credit offer.
Open a bank account. That allows information to filter through to TransUnion, describing your payment habits.
Use credit responsibly. Paying the outstanding balance on your credit card on time each month will affect your credit scoring within 6–12 months.
Can’t pay your accounts?
The National Credit Act states that you’re allowed to join a rehabilitation programme, but you need to contact the National Credit Regulator. Based on your level of debt, they’ll apply the necessary method for your rehabilitation.
Your credit record will affect your future planning, so go to www.mycredit.co.za to find out where you stand.
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