Good news for some people is that tomorrow (1 April) South African credit bureaus will remove all past adverse credit information they may hold on you. But what exactly does this all mean to you? And what information will stay on your record? How will banks know if you can afford to repay your credit? Does the amnesty mean I don’t have to repay my loans?
Very important: The Credit Information Amnesty does not mean that your debt will be wiped clean. You still have to repay all your loans.
What it does do is force credit bureaux to remove some of the information they hold about how you repay your loans.
Credit bureaux mostly keep two types of records on how you repay loans:
1. A payment profile, which shows your track record of paying your debt on time
2. A description of how you re-pay your debt, which includes information around, for example, you being liquidated, or if you merely if you absconded in any way to avoid repaying debt.
A credit bureau will continue to provide credit providers, like banks, with your payment profile (type No. 1 above).
It is this second type that the amnesty will address: the “adverse information” about how you repaid your loan. That information will be removed from your profile on 1 April.
You will in effect be given a fresh start with your payment profile and no negative information will be loaded to your profile in future if you continue paying your debt.
Very important: If from 1 April 2014 you don’t pay your debt and you have judgments against you, the past adverse information will again be added to your record.
What should you do if you feel that you may be over indebted?
You may be over indebted if - after deducting reasonable living expenses from your total income - you are or will soon be unable to repay your debts.
If you believe you are over indebted you should contact Standard Bank or other credit provider. At Standard Bank we will assess your situation and assist you in applying for debt review, if necessary. Call our Debt Review Helpline on 0861 111 525 or email
[email protected].
Also check information from the National Credit Regulator at
www.ncr.org.za.
