Nine tips to keep your credit score healthy

Only 53.3% of credit-active consumers in South Africa are in good standing, according to the Credit Bureau Monitor’s 2010 fourth-quarter report. What does this mean?

Well, if you’re hoping to secure a home loan, it’s bad news if you’re one of those not in good standing. Banks want to know that you’re a safe investment so they’re unlikely to lend to you unless you have a clear credit record.

A bad credit rating or adverse listing can seriously hinder your ability to secure home loan finance, says Kay Geldenhuys, property finance processing manager at Ooba.

It’s therefore very important to pay your accounts on time and make sure they’ve been paid before you apply for a loan. Retail stores’ and banks’ default listings will stay on your profile for two years. If you do close an account, settle the account balance and contact the credit provider to check your name and record has been cleared.

To keep your credit score healthy, follow these tips:


  • Make sure you meet your monthly debt repayments on time. Even a payment that is only 24 hours late can be bad for your rating.
  • If you fall behind on repayments, get back on track as soon as you can.
  • Always pay the minimum instalment required (or more, if you can).
  • Close accounts you don’t use. Credit providers assess the full facility of the credit agreements on record, even if they’re not being used.
  • Draw up a budget — and stick to it.
  • Boost your buying power and reduce your debt. If possible, pay more than the minimum payment on your accounts to further improve your credit standing.
  • If you can’t make a payment, talk to the relevant creditor about making an alternative payment plan.
  • Don’t ignore a letter of demand. Always be proactive and take appropriate action.
  • If you have a judgment on record, clear the account and contact an attorney to have the judgment rescinded, says Geldenhuys.

Read more news, blogs, tips and Q&As in our Smart Money section. Post questions on the site for independent and researched information

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