improve your credit record

How to improve your credit record in South Africa

Simple guidelines to improve your bad credit record

Having a bad credit record can be problematic is numerous ways. It’s no secret that being blacklisted can be a hassle, but it doesn’t mean that you can’t improve your credit record.

The reality is that low credit ratings make it harder to get access to loans.  For many people with low credit ratings, this means that they have limited options when it comes to getting access to finance.

As more South Africans opt for loans as financial solutions due to harsh economic conditions, more people are becoming over-indebted in the process. When people start to struggle to repay their debts, this could potentially lead to a bard credit record.

What steps you should take to improve your bad credit record:

  • The first step is to acknowledge that you have a bad credit record. You need to get a copy of your free credit report. By law, each credit active individual is entitled to a free credit report. In South Africa, the two major credit bureaus are TransUnion and Experian. Set up a profile with one of them and get your credit report. This should give you a better idea of how bad the situation really is.
  • You can then take steps towards improving your credit record.
  • Once you’ve established your credit record, you can then assess your debt thoroughly and how you can improve. Make sure that your credit details are up to date and that there are no errors.
  • Start by paying your bills on time. Aim to pay your bills at least a few days before the due date.
  • Avoid taking on new loans or credit cards. If you have a bad credit record, the chances of you qualifying for a new loan or credit card are slim, so applying is likely to have a negative impact on your credit record. If you do apply, get a co-signer to improve your chances of qualifying.
  • If you do repay a loan, make sure that you get a settlement letter as proof from the lender.
  • If you do apply for a home loan, you can offset the risk by putting down a large deposit. This can boost your chances of getting finance. By paying diligently, you can improve your bad credit record in the process.
  • Keep an eye on your credit card balances. If you own a credit card you should make sure that you repay your balances in full every month. Wherever possible, you should pay even more than the minimum balance.

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