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Mosala wrote to City Press when she discovered she was blacklisted.
“I lost my job and fell behind on some payments. How do I find out who blacklisted me?” she asks.
Salem Dyafta, consumer brand manager at TransUnion, explains that the word ‘blacklisting’ can be misleading.
“Credit bureaus do not keep a list of individuals who do not pay their bills or are too risky to grant credit to. All the credit provider does is provide the credit bureau with information about your payment behaviour – good and bad. This information is then included in your credit report.”
As Dyafta explains, if your credit behaviour is good and you pay the full amount owing on your accounts on time every month, this will be reflected in your credit report and may help you obtain more credit when you need it. But if your credit report shows that you don’t always pay what you owe each month, it may work against you.
Dyafta says one or two late payments should not be a problem.
“Anyone can forget to pay occasionally. But if your credit report reflects a pattern of regular late, partial or nonpayments, it could affect your credit rating.
“This could affect your chances of obtaining credit, or result in credit providers offering you less favourable terms, such as a higher interest rate,” says Dyafta, who adds that negative behaviour can stay on your credit report for 24 months, while judgments can remain on your report for up to five years or until you pay off the outstanding amount in full.
Should your payment history show that you have defaulted, it is unlikely that you will be able to obtain more credit – which leads to the idea of “blacklisting”.
It is therefore very important that you regularly check your credit record to understand your payment history and to identify any negative listings.
Payment profiles are automatically sent to bureaus. But according to the credit ombud, if a consumer has a default (not just a late payment), they need to be notified in writing 20 business days before this negative listing can be sent to the bureau.
Unfortunately, it is up to the consumer to prove they did not receive this communication. In the case of Mosala, if she was not notified by the credit provider, she can lodge a complaint with the bureau, and if the investigation finds that she did not receive the proper notice, the default may be removed. The credit provider will then have to notify the consumer before they resend the default to the bureau.
Mosala will first need to check her credit record to see which creditor or creditors listed her for defaulting on a loan.
Obtaining your credit record
Once a year, a consumer is entitled to one free credit report from each of the credit bureaus. This report will show your payment history and the various accounts you have.
It’s important to check your record, not only to check your payment history, but also to protect yourself against ID theft.
You will be able to tell from the report if loans or accounts have been opened illegally in your name.
Credit bureau Experian SA includes a credit rating in its free report.
The credit bureaus may charge for a more detailed credit report, which will include additional information such as your credit score or a list of enquires made on your credit profile. For a fee of R60, for example, you can get a more detailed credit report from TransUnion, which will include your credit score.
Understand your score
According to Dyafta, your credit score is a number calculated by a credit bureau using the data in your credit report. This includes payment history, the level of debt, length of credit history and the number of new accounts opened in a short space of time.
The TransUnion credit score provides you with a score/number value between 0-999 – the higher the number, the better your score.
Experian’s credit rating ranges from one to five – one is excellent and five is very poor.
Although not necessarily an endorsement, your credit bureau credit score does give credit providers a quick and easy overview of your general credit behaviour and is an indication of whether a credit provider is likely to regard you as a poor or excellent credit risk.
It is best that you get reports at least from Experian and TransUnion, because sometimes one bureau will have information that is not listed with the other one.
. TransUnion: mytransunion.co.za – click on ‘annual credit report’, the free option
. Experian: experian.co.za – click on ‘consumer services’
