11 May 2010

Non-Payment Gets You Blacklisted

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Adv Randolph Samuel @ Lucid Living

The number of consumers falling behind on their debt payments grew by a further 90,000 in the fourth quarter of 2010, according to the latest figures released by the National Credit Regulator (NCR). Over the 2009 period 880,000 consumers were blacklisted by creditors.

This takes the number of consumers with “impaired” credit reports (blacklisted) to a staggering 8.18 million people. That represents 45.3% of all credit active consumers, comprising 17.3% of consumers in 3+ months in arrears, 14.6% of consumers with adverse listings, and 13.3% of consumers with judgments and administration orders.

What are the implications of being blacklisted?

  1. Blacklisting is usually the first step that a creditor takes toward enforcing their rights to recover money owed to them. The blacklisting will remain on your credit report for 2 years;
  2. This is followed by handing the consumer over to a debt collector – which means being harassed with threatening correspondence and even face to face visits by these bullies;
  3. If the debt collector fails, the creditor will proceed to issue summons and obtain judgment against you;
  4. The judgment will then allow your creditor to do one of two things –
    1. Repossess your assets (viz. like your home, car and furniture); or
    2. Obtain a garnishee order (i.e. instructs your employer to deduct monies from your salary and pay over to your creditor)
  5. Any judgment for debt will be listed (for 5 years) on your credit report at the credit bureau. This will prevent you from accessing any credit during that period.

At this point, you have loss control over your financial future. Traditional avenues for improving your living standards and growing your wealth are closed. But this does not need to be your financial fate.

If you are among the 8 million people that have been blacklisted, you need to take charge of your financial situation immediately. This begins with knowing your legal rights and enforcing them.

  1. Prior to blacklisting you a creditor must give you 20 days written notice.
  2. Prior to taking any legal action, if you are behind on your payments, a creditor must give you written notice of your right to approach a debt counsellor.
  3. Debt review gives you a 60 day moratorium precluding creditors from taking any enforcement or legal action.
  4. Debt review prevents repossession of your assets, and lowers your monthly instalments to what is affordable for you.

To avoid being blacklisted contact Lucid Living NOW (010 590 5617). You will get objective and professional advice on your legal rights and your alternatives, to effectively managing your financial situation.

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