The Impact of the Credit Amnesty
The Removal of Adverse Consumer Credit Information and Information Relating to Paid up Judgments Regulations, 2014 (also known as the Credit Amnesty Regulations) came into force and effect on the 1st of April 2014.
The Credit Amnesty Regulations provide for the removal of the following information from consumers’ credit reports:
Adverse consumer credit information
“Adverse consumer credit information” includes:
- Subjective classifications of consumer behaviour such as ‘delinquent’, ‘default’, ‘slow paying’, ‘absconded’ or ‘not contactable’;
- Enforcement adverse classifications related to enforcement action taken by the credit provider, including classifications such as ‘handed over for collection or recovery’, ‘legal action’, or ‘write-off’;
- Details and results of disputes lodged by consumers irrespective of the outcome of such disputes and adverse information contained in the payment profile by means of any mark, symbol, sign or in any other manner or form also fall within the ambit of the definition of “adverse consumer credit information.”
- Paid Up Judgments which means civil court judgment debts, including default judgments, where the consumer has settled the capital amount under the judgment
Obligations placed on the credit bureau when dealing with adverse consumer credit information and paid up judgments:
Credit bureau are obliged to remove:
- Adverse consumer credit information as reflected on a consumer’s credit records as at the effective date of the Credit Amnesty Regulations, the effective date being the 1st of April 2014;
- Information relating to paid up judgments on an on-going basis.
- The above information must be removed within a period of two months as calculated from the 1st of April 2014.
- The duty to remove adverse consumer credit information within a period of 2 months as from the 1st of April 2014 applies even where the information relates to accounts that have not been paid. However, in terms of Regulation 5 of the Credit Amnesty Regulations, the consumer remains liable to meet his or her obligations in respect of the credit agreement.
- Credit providers are obliged to submit all information relating to paid up judgments to all registered credit bureau within seven days of receipt of such payment from the consumer.
- The duty on the credit bureau to remove information relating to paid up judgments is an ongoing duty that the credit bureau must discharge within seven days after receiving proof of payment from the credit provider
- Within three days of removing adverse consumer credit information and paid up judgment information, the credit bureau doing so must notify all other registered credit bureaux of such removal and in turn, the credit bureau that are notified must also remove the relevant consumer credit information from its records
If you feel uncertain about how the amnesty affects you, we can assist in the following ways:
- obtaining your credit reports
- studying the information listed on your credit reports
- identifying information that qualifies for removal in terms of the ‘credit amnesty’
- enforcing your rights in terms of the ‘credit amnesty’
- negotiating repayments to settle outstanding debts in order to have the information removed in terms of the new rules
- identify information that does not qualify for removal in terms of the amnesty, and advise what can be done to remove this information from your credit reports.