Having an impaired credit record is an affliction suffered by almost half of the 21 million consumers in South Africa. This ranges from consumers with defaults, judgements, administration orders and consumers who were three months or more in arrears with account payments.
Recently, between 1 April and 31 May 2014, the South African government implemented a credit information amnesty that benefitted at least 3.1 million consumers.
This is great news if you struggle with poor credit records and are seeking to secure a loan, the amnesty provides you with a fresh start. It is important to note that the credit amnesty will not free consumers of their obligations to pay off existing debt.
All of your debt still needs to be paid in full!
The credit amnesty does not allow you to access extra credit; that should be calculated according to your own affordability. Although the “black marks” will have been removed from your credit record, if you are under debt counselling, debt administration or have gone through sequestration or liquidation, these statuses will remain upon your record.
Records of action taken against you such as accounts handed over for collection, legal action or debt being written off will be removed. This is particularly beneficial if you have judgements against you as you will no longer need to go through a complex process with the courts to get the judgements against you set aside.