“Blacklisting, poor credit ratings, poor credit score, judgements, defaults, notices and adverse listings, adverse information and payment profile listings’ all terms that refer to information contained in individuals and business’ credit reports and profiles. These terms have in the past and continue to plague South Africans and South African business’.

How do the negatively affect you?

For the purposes of this article we will focus on the effect of blacklistings on applications for credit. Every time that you, as an individual or a Company apply for credit, the registered credit provider is obliged in terms of the National Credit Act to verify, if you can afford the repayments of the credit that you are applying for.

In making this assessment the credit provider will, amongst other things draw and review your credit report. The credit provider will be looking to see how you have maintained your accounts, in order to assess if you are a high-risk Client based on your past behaviour. Blacklistings, Judgements,  defaults, notices, adverse listings, adverse information and payment profile listings all give the credit provider information about how you have maintained your past accounts. They are one of the indicators that the credit providers will use to guide how successful your credit application will be.

If there is any negative information on your profile, it will be noted in your application for credit, making it more difficult for you to obtain credit.

What are blacklistings?

Whilst not defined by the National Credit Act, the term ‘blacklistings’ is used as an umbrella term to reflect any poor or negative information on your credit profile.

What are judgements?

When you have failed to pay any monies due to third parties, on notice to you, they may approach the Court, by way of a summons and a particulars claim and in some instances, by way of an application to bring your failure to pay to the court’s attention and to secure a judgement. Often with judgements that appear on your credit report, the Judgement is by default, meaning that you did not defend the action. Judgement debts are valid for 30 years;

What are defaults and Adverse listings?

These terms are used interchangeably, they refer to accounts that have been listed at the Bureaus, after you have not satisfied the demands in a letter of demand within 20 business days

What are notices?

Notices are matters that have been taken to court, they refer to administration orders, debt reviews and sequestrations. In most instances, you, as the consumer would have initiated these court proceedings and they will not come as a surprise.

What are Payment profiles?

Payment profiles are details of all of your accounts as well as an overview of how you have maintained the accounts on a monthly basis. If your monthly installments are paid in full, payment profile information can be a positive reflection of you as a consumer.

What can I as a consumer do to keep a healthy credit report:

Be proactive, obtain your credit report frequently and ensure that all of the information displayed on the report is correct.

Consumers are entitled to one free credit report a year from:

• Transunion
• Experian
• Compuscan
• XDS

Pay your monthly accounts on time.

If this is not possible, contact the creditors and enter into payment arrangements. We will discuss how to enter into payment arrangements in future articles;

Request statements of account, know what you are being charged for;

Ensure that you maintain your monthly payments;

Get Budgeting help and assistance;

What if I have Blacklistings?

If it comes to your attention that you have information on your credit report that you believe to be a blacklisting. Do not despair.

We can assist you with settlement negotiations and the removal or amendment of the information.

Feel free to email us at info@blvlaw.co.za

We look forward to engaging with you.

Written by Natasha La Vita, Partner at Berndt and La Vita Incorporated – 28 February 2024