Here’s a
simple, all-important fact about Credit Bureau Report.
People often think
that bad credit is a curse that will follow them forever. But the truth is that
you can solve most consumer credit problems within six months to a year. Even
better? You don’t need professional credit help to do it. You can complete the
repair process and rebuild your score without incurring any additional costs to
make it happen.
Here’s a quick overview of how
do-it-yourself free credit help works:
- Obtain your credit
reports for free – once a year
- Review your reports
to identify errors
- Dispute those
errors to clean up your profile
- Take the right
steps to fix your score
- Avoid actions that
slow down or stop your progress
Step 1:
Obtain your Free Credit Report once a year
The first step to
fix your credit is to get a copy of your credit report. Try and obtain the your
Free Reports from ITC, Experian, XDS and Compuscan.
By law, you can
download your reports for free once every twelve months through www.transunion.co.za, www.experian.co.za, www.xds.co.za, www.compuscan.co.za . This is the different
Credit Bureau websites where you can get your reports with really no strings
attached. Just answer a few security questions and you can access your reports
from all 4 bureaus.
If you want to fix
your credit score following a period of financial distress, you should download
all your reports.
Step 2: Check
your Credit Reports for errors
Fact: 1
in 20 credit reports contains an error that would decrease a consumer’s credit
score by 25 points or more.
Credit report
errors often contribute to a lower score, particularly following a period of
financial hardship. There may be issues like mistakes in your payment history
or outdated account statuses that could impact your score.
So, you want to
read through each copy of your credit report carefully to identify mistakes or
errors. Look for:
- · Why you need to challenge your Credit Report
- · Most of the time the information on the
credit bureaus is incorrect.
- · Missed payments that you made on time
- · Duplicate accounts, which throw off your
debt-to-income ratio
- · Outdated account statuses, such as
charge-offs
- · Collection accounts that are either paid or
not really your debts
- · Judgements and Garnishee orders could be
filed incorrectly
- · Accounts balances on the Credit Bureaus are
inflated
- · Accounts has reached Induplum - Despite
any provision of the common law or a credit agreement to the contrary, the
amounts contemplated in s 101(1)(b) to (g) that accrue during the time that a
consumer is in default under the credit agreement may not, in aggregate, exceed
the unpaid balance of the principal debt under that credit agreement as at the
time that the default occurs. Once the amounts referred to in s101(1)(b) – (g)
that accrue during the period of default, whether or not they are paid, equal
in aggregate the unpaid balance of the principal debt at the time the default
occurs, no further charges may be levied.
- · Section
101 – Interest, initiation fee, service fee, credit insurance, default
administration charges, and collection costs.
- · Debt has prescribed- 3 YEAR
PRESCRIPTION PERIOD APPLIES TO In short, according to the Prescription Act, if,
in the past three years you have not made any payment towards settling a debt,
acknowledged owing the debt in any way – including over the phone – agreed to
pay it, or been summonsed in respect of it, it has prescribed, and you can
raise this as a defense when asked to pay it. NOT ALL DEBT PRESCIBES IN THREE
YEARS
- · Judgements are incorrect
- · Wrong credit scoring
- · And many more
Any of these types
of errors can contribute to a lower score. Simply asking the credit bureaus to
correct these mistakes can help you achieve the score you want.
You can find more
information in section 70 -73 of the National Credit Act how to lodge a dispute
Step 3:
Dispute the mistakes on your Credit Report
What does the NCA Act do?
The Act stipulates
that each credit bureau must register with the National Credit Regulator in
order to conduct business legally; It sets out the
purposes for which consumer credit information may be used, and the companies
to which the credit bureau may provide the information; It sets out
standards for data accuracy to ensure that information kept by a credit bureau
on your record is always accurate;
It ensures that
each consumer has the right to check his or her record, and that any mistakes
are corrected.
To complete the repair process on your own,
follow these steps:
- Decide how you want
to dispute the mistakes you identified
- Each bureau has an online portal you can use
to make disputes for free. This option is less hassle and it’s free.
- Detail each dispute clearly and
concisely. Make sure to include your name, the account and the specific
issue that you wish to have verified.
- The credit bureaus have 20 days to verify
the information. They’ll check with the original credit or lender to
provide verification; they may also ask you to provide documentation – always
send them copies and keep your originals.
- If they can’t verify the item, they must
remove it from your report. Once the bureau removes the item, they should
provide another free report so you can confirm it’s gone.
- That’s all the credit repair does. So, you
can do all of that on your own and avoid paying a company fees to do it for
you.
Step 4: How
to avoid any actions that would hurt your score
The key to building
credit is that you don’t want to take any action that incurs a negative item
now. It’s easy to offset negative items in the past with positive actions now.
If you incur a negative item now, it will be bad for your score.
That means you
should be extremely vigilant to avoid actions which would result in more
negative items in your report:
- · Don’t miss any payments by more than 30 days
- · If you have financial problems speak to your
creditors
- · Try pay your accounts before the 7th
of every month
- · Stay on top of things like out-of-pocket
medical bills to avoid new collection accounts
- · Never run up your account balances to their
credit limit
- · Avoid opening multiple new accounts within a
six-month period
- · Don’t close your oldest accounts
- · Stay away from high risk credit providers,
such as payday loans
Step5:How
long does it take to fix my credit score?
Section of
the National Credit Act
(3) If a person has challenged the accuracy of information
proposed to be reported to a credit bureau or to the national credit register,
or held by a credit bureau or the national credit register, the credit
provider, credit bureau or national credit register, as the case may be, must
take reasonable steps to seek evidence in support of the challenged
information, and within the prescribed time after the filing of the challenge
must-
(a) provide a copy of any such credible evidence
to the person who filed the
(b) remove the information, and all record of
it, from its files, if it is unable to find credible evidence in support of the
information, challenge, or subject to subsection (6).
(4) Within 20 business days after receiving a copy of evidence in
terms of subsection (3)(a), the person who challenged the information held by a
credit provider, credit bureau or national credit register may apply in the
prescribed manner and form to the National Credit Regulator to investigate the
disputed information as a complaint under section 136.
(5) A credit bureau or the National Credit
Register may not report information that is challenged until the challenge has
been resolved in terms of subsection (3)(a) or (b).
(6) On application
by a credit provider, credit bureau or the National Credit Regulator, as the
case may be, the Tribunal may make an order limiting the applicant’s
obligations to a consumer in terms of
this section if the Tribunal is satisfied that the consumer’s-
(a) particular request or requirement is
frivolous, unfounded or wholly unreasonable;
or (6) history
and pattern of such requests or requirements are frivolous or vexatious.
(7) Failure by a
credit bureau to comply with a notice issued in terms of section 55, in relation to this section, is an offence.
Remember You Have Rights
There Is Life After Debt
