Credit Report Restoration
If you can afford the credit you applied for, but your application was unsuccessful, then it is most likely that you have negative information stored on your credit report. Such information can be challenged and rectified if need be.
- How to Improve your Credit Report
- Data-Retention Periods for Credit Bureau Information
- The Impact of the Credit Amnesty
Your credit record is essentially a report on how well you manage your credit. The credit system is based on trust, but people are people and creditors cannot tell how trustworthy a consumer is with credit, unless they have a record of how the consumer behaves with his or her credit. Thus, this information is used by creditors to help determine your credit score and hence your creditworthiness. Prior to the implementation of the National Credit Act, you could be declined credit merely on the basis that you have not made use of any credit in the past and as such, you have no solid credit history by which potential future credit providers could assess your ability to repay your accounts. This is no longer allowed under the National Credit Act and you have the right to receive reasons in writing for why your credit application has been declined.
Should your credit record be a factor, it is advisable that you obtain a credit report as soon as possible and have it assessed by a professional to determine whether there is any negative information on your credit report that may prevent you from obtaining credit.
Consumers are entitled to a free copy of their credit report once a year. The credit bureaux contact details are as follows:
- Transunion – 0861 482 482 or www.mytransunion.co.za
- Experian – 0861 105 665 or www.experian.co.za
- XDS – 0860 937 000 or www.xds.co.za
- Compuscan – 0861 514 131 or www.compuscan.co.za
Please send a copy of your credit report to firstname.lastname@example.org. South African Law Centre offers a non-obligatory free assessment of every credit report. Should you not be able to obtain a free credit report anymore, please complete the form below.
Data-retention periods for credit bureau information, taken from Chapter 15, “Credit Bureaux” by N Campbell, as published in “Guide to the National Credit Act”, (Lexis Nexis).
The National Credit Act prescribes the maximum periods for which consumer credit information may be recorded on the consumer’s credit record. Regulation 17(1) of the National Credit Act sets the maximum periods for the retention of credit bureau information as follows:
|Categories of consumer credit information||Description||Maximum period|
|Details and results of disputed lodged by consumers||Number and nature of complaints lodged and whether complaint was rejected. No information may be displayed on complaints that were upheld.||6 months|
|Enquiries||Number of enquiries made on a consumer’s record, including the name of the entity/person who made the enquiry and a contact person if available.||1 year|
|Payment profile||Factual information pertaining to the payment profile of the consumer.||5 years|
|Adverse classifications of consumer behaviour||Subjective classifications of consumer behaviour.||1 year or within fourteen business days after settlement by the consumer.|
|Adverse classifications of enforcement action||Classification related to enforcement action taken by the credit provider.||1 years or within fourteen business days after settlement by the consumer.|
|Debt restructuring||As per section 86 of the Act, an order given by the Court or Tribunal.||Within the period prescribed in section 71(1) of the Act or until a clearance certificate is issued Click here for further clarification.|
|Civil-court judgments||Civil-court judgments including default judgment.||The earlier of 5 years or until the judgment is rescinded by a court or abandoned by the credit provider in terms of section 86 of the Magistrates’ Courts Act 32 of 1944 or within the period prescribed in section 71A of the Act.|
|Administration orders||As per the court order||5 years|
|Sequestration orders||As per the court order||5 years or until the rehabilitation order is granted|
|Rehabilitation Orders||As per the court order||5 years|
|Maintenance judgments in terms of the Maintenance Act 99 of 1998.||As per the court judgment||Until the judgment is rescinded by court.|
Adverse classifications of consumer behaviour are subjective and include such classifications as “delinquent”, “default”, “slow paying”, “absconded” or “not contactable”. Adverse classifications of enforcement action are classifications related to enforcement action taken by the credit provider, including such classifications as “legal action” or “write-off”. “Payment profile refers to the consumer’s payment history in respect of a particular transaction.”
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.