John Vaughan (Financial Advisor) @ LUCID Clear Credit
Ensuring that you have a clear credit report is the first and foremost step prior to applying for finance, as without a clear credit report your finance application will not be successful.
Chris De Kock, Executive Head of Sales and Marketing at WesBank, says that many of those with impaired credit reports may be unaware that they are on this blacklist, or are there as a result of “minor” infringements. “Nevertheless, the result is often the same – a bad credit rating or an blacklisting on your name can seriously hinder your ability to secure asset finance.”
De Kock says that one of main reasons vehicle applications are declined is because of the applicant’s credit report. To optimise your chance of securing your vehicle finance loan, it is imperative to keep a tidy credit report by ensuring that all of your accounts have been paid to date before you apply for financing.
“When closing an account, it is best to rather settle the account balance and then contact the relevant credit provider to check that your name and credit record has been cleared. If you have a judgment on record, ensure that your account is cleared by contacting a litigation attorney to have the judgment rescinded.”
De Kock says in that in order to keep a healthy credit report, consumers should follow the following guidelines:
– Ensure that you meet your monthly debt repayments on time to avoid a tarnished record.
– If you fall behind on repayments, get back on track as soon as you can.
– Always pay the minimum instalment required.
– Draw up a budget – and stick to it.
– Boost your buying power by reducing 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.