What does being blacklisted in South Africa mean?
Previously, when credit bureaus only stored negative information, people in South Africa who made use of credit services could be blacklisted. However, for some time now, there has been no such thing as being blacklisted in South Africa. This is because credit bureaus store both negative and positive information regarding your credit profile/ credit history.
The term "blacklisting" can be misleading. It actually refers to any negative information that could be present on your credit profile. This negative information can mean that you are seen as a high-risk borrower to creditors.
How do I find out if I'm blacklisted?
While there is no such thing as being blacklisted in South Africa, your credit report can contain negative information. You can check if you're 'blacklisted' for free in South Africa online or view this negative information by getting a copy of your credit report. Most credit bureaus offer one FREE copy of your credit report every year. Check out Experian for a copy of yours. This negative information can affect whether you get approved for a loan and your overall credit score. The negative information that can be stored on your credit profile can be:
- Judgements
- Inquiries into your credit report (when a credit lender requests to review your credit report before granting you credit)
- Defaults or late payments
- Collections (if your account has been handed over to a debt collector)
Find out everything you need to know about your credit score and how you can improve it by watching this video with Founder & CEO of Meerkat, David O'Brien:
What happens when you are blacklisted in South Africa?
Some of the consequences of being 'blacklisted are that credit lenders will see you as a higher risk and may either:
- Not approve your loan or credit application.
- Grant your loan application with a higher interest rate.
Do you want to stop negative information from appearing on your credit report? Are you stuck in a cycle of missing debt payments. Meerkat can help you!
How long does blacklisting last in SA?
The time negative information remains on your credit report depends on the type of negative information it is. Let’s consider how long ‘blacklisting’ lasts in South Africa, depending on the type of negative information:
What is a judgement in South Africa?
A judgement is granted by a court against a consumer who has not paid their debts according to their credit agreement.
Read: What to do if you have a judgement against you
How long can a judgement stay on your credit report?
A judgement can stay on your credit report for 5 years or:
- Until you’ve paid the outstanding balance in full.
or
- Your judgement is rescinded by a court.
Read: What to do if you have a judgement against you
What does defaulting on your account mean?
Defaulting on your account means you have not followed the terms of your credit agreement. This agreement was signed when you took out a loan for a service or product. A default can include either missed or a late payment.
When will a creditor let a credit bureau know you’ve missed a payment?
A creditor will usually wait at least 30 days after a consumer has missed a payment before notifying a credit bureau.
How often is your credit report updated?
Your credit report is usually updated every month when creditors send credit bureaus updates regarding your credit profile.
How long does an inquiry remain on your credit report?
An inquiry by a credit lender can remain on your report for 1 year.
How long does a default or missed payment remain on your credit report?
A default can remain on your credit report for 5 years.
How can I improve my credit score after being blacklisted?
The best way to improve your credit score after being blacklisted is to pay your debt. You can dispute incorrect information on your credit profile, but you can’t dispute accurate information.
3 Tips to improve your credit score
- Pay your debts in full and on time each month.
- Do NOT take out any more credit.
- If you are able to, pay more than the minimum balance each month.
How do you clear your name from ‘blacklisted’ in South Africa?
If you cannot make your monthly payments or fear you may miss them and get negative information on your credit report, you should strongly consider debt review. This is a great option to help you manage your debt.
Debt review, also known as debt counselling, is a legal debt relief measure in South Africa. Its purpose is to assist South Africans who have too much debt and can't afford to make their monthly debt repayments.
It works by assessing if you are over-indebted. It also takes into account your income and expenses. This creates a reduced and affordable repayment plan to pay off your debt.
Read: Debt counselling | Everything you need to know
Who is Meerkat?
Meerkat is a financial wellness company that wants to help South African consumers do MORE with their money. We can help with debt repayment negotiations, provide affordable insurance and help you kickstart an emergency fund
Fill in the contact form on our website to receive a free callback from the Meerkat team today.