If you have been declined for credit, the credit bureaux will not know why you have been turned down. Only the credit lender with which you have made the application can tell you why your application was declined. Most lenders will look at your personal credit report and use it as part of the decision-making process.

If one company turns you down it does not mean that all other lenders will do the same. Different companies take different factors into account when deciding whether to grant credit.

Credit bureau information
If you are turned down as a result of credit bureau information, you should contact a credit bureau to obtain advice on what action to take. In this way, when you do apply to another bank, you can arm yourself with the relevant information.

If you have a problem with your credit bureau report, the credit lender will advise you to contact the applicable credit bureau from which they obtained your credit report. This could be one of two credit bureaux in South Africa — Experian or Transunion ITC. There could be many different ‘issues' related to your credit bureau report. These include:

  • The way in which you pay the accounts you already have.
  • Defaults that may have been listed against you due to the non payment of debt.
  • Collection company listings where you have been handed over due to non-payment of debt.
  • Judgments that have been granted through a court, normally as a result of non payment of debt.
Point score
You may be told that your point score is not high enough. This is generally related to the company's own credit granting policy. The score referred to is typically a credit bureau score. A company who uses the score will have done a statistical analysis to arrive at a 'cut-off score'. In other words; a benchmark where an application will be declined if the score is below, or accepted if the score is above the cut-off.

It should be noted that this score is based only on the information the bureau has on your credit report. Under these circumstances, your score cannot be changed in the short term; however, maintaining a healthy credit record by regularly paying your accounts will positively impact your credit bureau score in the future.

Damage done by accident, mismanagement
If you have damaged your credit profile by accident or by mismanagement it may take some time to fix it. Don’t give up on trying to get it back on track as it is a vital part of would financial wellness. According to Experian, keeping in touch with your credit report and managing your credit record will not only give you peace of mind when you apply for credit, but it will also protect you against fraudsters who may try to use your identity number to fraudulently obtain credit in your name.

In fact, it is your right to know what information is on your credit report. On your request, a credit bureau must provide you with a copy of your credit profile for a nominal fee, provided that they have been able to confirm your identity. A credit bureau will be able to provide you with advice and a clear explanation of the information on your credit report.

It is also your right to address any incorrect information with a credit bureau. If you feel that the information on your credit report is incorrect, you can contact their consumer relations division, they will investigate the information with the credit grantor concerned, and will amend or delete it if it is proved to be incorrect. 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.

The credit bureau should notify both you and the credit lender, where you applied for credit, of the correction. All relevant credit lenders will be notified accordingly.

Adapted from www.experian.co.za


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