Being blacklisted for loans is not the end of the road for you. Financial institutions can blacklist you when you cannot fulfill your loan repayment terms. Because of this, you will not qualify to get a traditional loan once they blacklist you. Financial institutions blacklist you as a sign to other lenders to avoid you.
Blacklisting is a term that describes what happens when financial institutions deny you loans because of your poor credit record. Finance companies and banks decide whether to give you a loan depending on the information they get from credit bureaus.
What is the work of Credit bureaus?
Credit bureaus calculate your credit score based on your financial behaviour, which could be positive or negative. When you make payments on time or as your repayment term says, it will reflect on your credit score (making it positive). When your credit score is positive, you get a better interest rate and terms than someone with a negative credit score. But if you cannot make your payments on time or defaults your repayment terms. It will reflect on your credit score (making it negative). These loan providers consider before they give out loans to borrowers.
However, if you’re blacklisted, you can still get a loan. The only thing to worry about is that you can’t get a blacklisted loan from all financial institutions. Some financial institutions accept blacklisted clients. You will need to tarry longer while searching for lenders that will assist you.
What are Blacklisted loans?
Blacklisted loans are the loans customers who are in the blacklist can get from a financial institution. Usually, blacklisted loans come with higher interest rates than other loans. Beside that, provide a collateral for you to get a blacklisted loan. This is because it involves a higher risk to the lender than other forms of loans.
What are the requirements for blacklisted loans in South Africa?
There are requirements for all forms of loans. These requirements make you eligible to get a loan. For blacklisted loans, you also have to provide requirements to get it.
The following are the requirements for blacklisted loans
- You must be a South African citizen with a green barcode identity
- Have a bank account that can accept debit order
- Be earning a minimum salary of R3000 per month
Where can I get a blacklisted loan?
Getting a blacklisted loan is now easy to process and completed with just a few steps. This is because some banks in South Africa will give you a chance blacklisted loan.
The following is the list of financial institutions that can give you blacklisted loans:
- Absa personal loans
- African Bank loans
- Personal loan lenders
- Direct Axis personal loans
- Nedbank personal loans
- FNB personal loans
- Capitec personal loans
- Nedbank personal loans
- WesBank personal loans
Can they blacklist my Bank Verification Number (BVN)?
Defaulting your repayment terms with a financial institution earns you a place in their blacklist. They don’t just let you slip away like that. They follow you up and make sure that other financial institutions don’t fall prey of your bad credit score.
You would wonder if they can blacklist your BVN. Once they blacklist you, they tie it to your BVN, which reflects on all your bank accounts. This makes it impossible for you to get credits or loans on any of your bank accounts.
In the quest to identify defaulters, financial institutions sometimes feel that the defaulters are fraudulent. Besides that, they are not just out against susceptible individuals.
How long does blacklisting last in South Africa?
Being blacklisted could be a serious problem for any borrower. Especially a borrower that is still struggling financially. Getting blacklisted stops any form of credit getting into their bank accounts. Therefore, it would be really nice to know how long blacklisting lasts in South Africa.
In South Africa, blacklisting lasts from 2 to 5 years. They still blacklist you even after you repay your outstanding debts. Your credit profile still suffers the blow from 2 to 5 years.
What can I do to get my name out of the blacklist?
Having known that you still get blacklisted even after you repay your outstanding debts. It’s the right time to know what to do to get your name out of that blacklist.
However, you can get out of the blacklist successfully. This is possible because the National Credit Act 34 of 2005 says that you pay the debt for which they blacklisted you. You can apply to the credit bureau that listed your name to remove your name from the blacklist.
How can I check if I’m blacklisted?
So many defaulters of loan repayment terms do not even know that they are already blacklisted. They might think that they have the liberty to apply for another loan from a different financial institution. But this is not so with how financial institutions checkmate compliance to repayment terms of loans. In South Africa, you can check if they blacklist you. Everyone has the right to one free credit report from any credit bureau in South Africa. Besides that, you can get your account status credit score and summary for a small fee.
What are the contacts of the Credit Bureaux in South Africa?
In South Africa, every consumer has the legal right to one free credit report per year. And this credit report must come from each of the credit bureaus that they registered.
The following are the contacts of the 13 credit bureaus they registered:
- TransUnion- 0861 482 482
- Experian SA- 0861 105 665
- Crosscheck Information Bureau (formerly known as MLCB)- 010 590 9505
- Compuscan- 0861 514131
- Xpert Decisions Systems (XDS)- 011 645 9100
- Consumer Profile Bureau- 010 590 9505
- CreditWatch- 011 483 0086
- Managed Integrity Evaluation- 012 644 4000
- Inoxico- 010 001 0540
- LexisNexis Risk Management- 011 245 6500
- Tenant Profile Network- 086187 6000
- Robertsons International Reports- 011 777 4000
- Tenant Watch Business Activities- 011 394 6828
Note: If you have any problem with one of the credit bureaus. You can contact the National Credit Regulator or the Credit Ombudsman on the following contacts:
- National Credit Regulator: 0860627627
- Credit Ombudsman: 0861 662 837
What makes up a credit score?
To avoid a negative credit score, know what makes up a credit score.
A credit score ranges from 300 to 850 that shows your credit rating. It depends on the positive or negative information they get in your credit report.
The information in your credit report involves:
- The amount of money you owe
- Your payment history
- The activity on your bank account
- How long you have used your accounts
- The number of credit check on you
Note: Your credit score reveals all your financial behaviour either good or bad.
What types of loans can I get as a blacklisted customer?
As a blacklisted customer, you would not hesitate to know what types of loans you are likely to get.
The following are the loans you can get as a blacklisted customer
- Payday loans
As a blacklisted customer, you could get private lenders who will offer you a short-term micro loan.
The payday loans are usually an unsecured personal loan. The only thing you should worry about is that they come with hard conditions and higher interest rates.
It would be very difficult for you to borrow an enormous amount and repay it with its high interest rate. This could be too expensive for you to handle.
- Secured loans
Getting a secured loan as a blacklisted customer is easy. This is because you have to present a collateral for you to get the loan. This collateral must be an asset you own. Also, the asset can be your car, house, business, etc. However, if you cannot pay back the loan, you will lose your property.
What can deny me blacklisted loans?
Knowing that you can get a blacklisted loan doesn’t mean that something cannot deny you the blacklisted loan.
The following are what can deny you a blacklisted loan:
- If you cannot afford the monthly loan installment
- When you apply for debt counseling or review
- Applicants that are at the same time under sequestration
Blacklisted loans are usually what defaulters look out for. It is clearly the last resort they have to pull the strings of whatever financial obligation they have at hand. Financial institutions have come to their rescue. But it is now up to the blacklisted customers to oblige with the blacklisted loans repayment terms. Failure to do so will worsen their already bad credit score. Besides that, they will lose their assets (collaterals) to secure a loan from the lender.