A Fin24 user who suspects he is blacklisted writes:
I have a few debts and I think I’m blacklisted due to unemployment.
I recently got a job where it is compulsory to have a car.
With the bad record I cannot get one. Please advise.
Friedl Kreuser of Summit Financial Partners
Firstly, I think we should clarify what blacklisting means. Many people mistakenly think that there is an ominous list to which the names of bad payers are added to lock them out of the credit-granting world.
In reality, there is no such list. Blacklisting is merely a term that indicates that someone has a poor credit rating, based on negative information (like judgments and missed payments) on their credit record.
This will, of course, in turn affect their ability to get further credit, but a credit record merely reflects the reality of their payment record – good or bad.
Secondly, unemployment in itself will not lead to a poor credit record. However, missed payments - and subsequent judgments from credit providers due to unemployment - could.
If you believe you are blacklisted, you should merely draw a copy of your credit record to see what negative information your potential credit providers are seeing.
Every consumer is entitled to one free credit record per year from each of the credit bureaus. There are around 10 credit bureaus in South Africa, but consumers can focus on the top three - TransUnion ITC, Experian and XDS.
If you feel the negative information on your credit record is inaccurate, you can easily clear it up by challenging the relevant credit bureaus and asking them to correct the information (you may have to provide proof).
This should then improve your credit rating, which would also allow you to apply for vehicle financing.
If the negative information is accurate, there are ways to improve your credit record. For accounts in arrears, the only way is the obvious one – to pay up the accounts.
For valid judgments against your name, you can get permission from the relevant credit provider to apply to the court to rescind (effectively cancel) the judgment against you.
In order to do this, however, the credit provider will require you to first pay up the full judgment amount. This should then improve your credit record enough to apply for vehicle financing.
If you do not have the funds to bring arrears accounts up to date, you can consider leasing a vehicle temporarily until you can improve your credit record to such an extent that you can apply for vehicle financing, or you could try to make arrangements with your new employer to help with financing or leasing a vehicle.
* Do you have a pressing financial question? Post it on our Money Clinic section and we will get an expert to answer your query.
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