Credit Bureau (Transunion, Experian And XDS)
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A credit bureau is a vital tool to ensure access to credit and it is therefore important to understand the role of a credit bureaus including ITC & Experian. A credit bureau is a 'library' of credit information, providing a centralised database of consumer credit behaviour i.e. how well you manage your credit commitments. This information could either be positive (i.e. accounts that are up to date, or fully paid up); or negative information pertaining to judgments and adverse credit information of defaulted credit accounts. Looking for a free credit check?
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The role played by credit bureaus is an important one as they usually provide vital information to credit providers to prevent over-indebtedness of consumers and the granting of reckless credit. The NCA contains detailed provisions dealing with information held by credit bureaus.
Section 70(1) provides details of what information a credit bureau may store. It employs a wide phrase, ‘consumer credit information’ which means:
• a person’s credit history, including
- applications for credit, credit
agreements to which the person
is or has been a party;
- pattern of payment;
- default under any credit such agreement;
- debt re-arrangement in terms of the NCA;
- incidence of enforcement actions with respect to any such credit agreements;
- the circumstances of termination of such credit agreements, and
- related matters.
• a person’s financial history including
- past and current income;
- assets and debts;
- other means within the scope of that person’s financial means;
- prospects and obligations as defined in section 78(3)73 and
- related matters.
• a person’s education, employment, career, professional or business history, including the circumstances of termination of any employment, career, professional or business relationship and related matters, or
• a person’s identity, including his or her
name, date of birth, identity number,
marital status and family relationships,
past and current addresses and other
contract details, and related matters.
Section 70(2) to (6) sets out credit bureaus
duties. Regulation 55(5) requires credit
bureaus to keep and maintain all records for a period of three years from the date on which it received the document.
When opening an account with a company, the decision to grant credit rests with the company and not with the credit bureau. Obviously when it comes to home loans, the banks ultimately decide whether you get credit or not, but in terms of Retail Accounts and Personal Loans the decision comes down to the company and their financial department. This decision is based on the credit lender's own credit granting policy, which could also take into account the information on your credit report.
Information the Experian Bureaux holds is sourced from:
- Almost all companies that offer credit Public information from the South African courts on civil judgments, sequestrations and administration orders
- Should you not be in a position to pay your accounts in time, be sure to pay the outstanding amounts as soon as possible.
- Should you fall 3 or more months into arrears, this can have a negative affect on your credit report. Communicate with the companies concerned and make alternative arrangements.
- Budget, never buy on credit without knowing if you can afford the repayments; and try to keep your credit repayments between 20% and 30% of your income.
- Obtain a copy of your credit report at least once a year from the credit bureau (Free Once a Year or contact the Debt Doctor for more information)
- Never lie on an application form for credit and never ignore a letter of demand for payment.
Current issues with ITC & Experian:
There have been many complaints with regards to the ITC and EXperian IT systems. ITC systems as you may have heard are very out of date and innacurate. The information dispayed is incorrect partly due to people being able to ad information without any proper legal checks and processes in place.
The credit bureau and your rights
Staying abreast of your credit status will not only give you peace of mind when you apply for credit, but will also protect you against fraudters. As of 1 September, Experian now provides you with a free annual copy of your creut report, provided that you apply in the month of your birth or thereafter. You can order your Experian credit report by contacting Experian's Consumer Relations desk on 0861 10 56 65. A credit bureau will be able to provide you with advice and a clear explanation of the information on your credit report, which you are free to query or register as a dispute. The dispute will be investigated and Experian will respond within 20 working days. Should the information prove to be incorrect or unsubstainable it will be removed. Should you not be satisfied with the resolution of your query, you may contact the office of the Credit Information Ombud on 0861 66 28 37.
Experian also offers a credit report monitoring service that avails you access to your personal credut information and proactively alerts you to changes on your credit profile. This service will send you an SMS when important changes are reflected on your credit report.
Contact Wizard for Credit Checks on ITC and Experian.
How to check your credit record or rating
As a consumer or small business owner, you should regularly check your credit record at the credit bureau, especially if you are ever refused credit or you are told you have a bad record. There is a small charge for this service.
The contact numbers of the credit bureaus are:
- Compuscan (also for microlending issues) – 0861 514 131;
- Experian Website (consumers) – 0861 10 5665;
- Kredit Inform (businesses) – 011 777 2700;
- Transunion ITC (consumers and businesses) – 0861 482 482; and
- Micro Lenders Credit Bureau – 0861 28 7328.
If you do not agree with any of the information on your report, you can ask the credit bureau to give you all the facts. The steps you must take include:
- Ask the credit bureau for a reference number and the name of the person to whom you spoke. Make a note of the date and time of your call.
- Allow a maximum of 30 days for the credit bureau to resolve the query.
- If your query is still unresolved after 30 days, or if you are not satisfied with the way the credit bureau has resolved your complaint, contact the call centre of the Credit Information Ombud at 0861 66 28 37 or go to creditombud.org.za and submit a complaint form (quoting the reference number you were given by the credit bureau).
- If your query is within the jurisdiction of the ombud, an investigation will be launched, free of charge. You may be contacted to provide additional information. Your complaint will be forwarded to the organisations that listed you for their response.
Once the ombud’s office has all the facts of the case, it will negotiate a settlement or make a ruling.
If you are satisfied with the ombud’s decision, the case will be closed. If you are not satisfied, you can act through the courts.
How to clear your name
It is difficult to get judgments and defaults removed from your credit record with the credit bureaus.
You should not be fooled by advertisements on street poles which claim that credit repair agents can "clean" or "repair" your credit record. It is, in fact, illegal for credit repair agents to promise to remove valid listings for an upfront fee.
They will charge you high fees, and there is very little they can actually do for you. Credit bureaus are not allowed to remove a judgment before the five-year retention period, unless it has been rescinded (removed) by a court of law.
If you have a judgment against you, and you have paid in full and want it to be rescinded, you need to employ an attorney at your own cost.
Default listings remain on file for three years, and if you really owed the money, there is nothing you can do to have them removed, even if you have now repaid the debt in full.
Your only real hope then lies with the office of the Credit Information Ombud. But he can only order the early removal of default listings if you meet all of the following three criteria:
- You defaulted due to circumstances beyond your control
- You showed an intention to honour your debts and communicated proactively
- You have been rehabilitated (paid the debt in full).
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