Having a healthy and clear credit record will greatly help you when you’re trying to apply for a home loan or other finance. Although it is not impossible to secure a homeloan if you are blacklisted, there are many penalties you can avoid and benefits you will enjoy by taking these 3 solid steps to improve your personal credit profile.
1. Obtain a copy of your credit report.
There are presently two major credit bureau’s that are presently used by the banks to access information about your credit profile. They are namely Transunion ITC and Experian. To access your ITC Transunion report, you may visit their website www.mycredit.co.za or alternatively contact them on 0861 482 482.
Experian may be accessed online via www.creditexpert.co.za or by contacting them on 0861 10 56 65.
Alternatively you may obtain a consolidated copy of your credit report which features both the above mentioned bureau information as well as your credit score by clicking onto www.credithealth.co.za
2. Identify and extract key problem areas
Once you have obtained an up to date credit report, you may now pinpoint the exact issues that could be deterring you from securing a home loan or any other form of finance. Problematic accounts will be split into arrears and late paid accounts, and
negative listings in the form of Adverses, Defaults, Judgements, and Trace Alerts etc.
It is important to highlight the problem accounts and obtain contact details for the relevant service providers. Usually the contact details of the relevant collections company will be listed on the actual report for ease of reference.
Compile a list of the problematic accounts and start with the arrear accounts and work your way through to the more serious listings in order of importance.
3. Action Plan
For late paid or arrear accounts, you would only be required to bring the account balance up to date, and not necessarily settle and close the full account. Once you have brought all the accounts up to date, and you will need to maintain your payments for minimum period of 6 months.
This will help steadily increase your credit score and rebuild a positive record with the credit bureau. In the case of negative listings, such as adverses, defaults and judgements, a full settlement will need to be made before you are able to move onto the next step of clearing your name completely.
Only once the full and final settlement of each listing has been made, will you be able to appoint the services of an attorney to rescind the listing by means of administrational applications made to the companies who listed you, as well as the
local magistrate court concerned.
For a list of attorneys you may visit the website www.attorneys.co.za
Attorneys fees can range between R1500 and R2500 depending on the amount of time and administration spent to resolve the issue at hand.
The process could take up to 6 months to conclude, however this is far better than having to wait out a 5 year retention period prescribed by the credit bureau for judgement listings, and a 2 year retention period for adverse listings.