Blacklisted loans in South Africa
Some people feel the term “blacklisted” means totally condemned and unworthy. Though this is to some extent true, it is definitely not as bad as it sounds and that is where loans for blacklisted people come in. Through this article, you’ll get to know the various credit services available for people whose names are on the financial blacklist for one reason or the other.
What does it mean to be blacklisted
When you are blacklisted, it simply means that the financial organization thinks you are a potential risk to the service they provide. It is important to note that the term blacklisted is deceiving, as there is no so-called official ‘blacklist’. You are blacklisted because of failure to merge and repay their debts and bills.
How do you know you are on the blacklist?
In South Africa, everyone has the right to one free credit report per year from any credit provider. Apart from that, some companies can give you your account status, credit score, and a credit summary for a small fee. Note that no company will ever tell you you’ve been blacklisted. A list simply does not exist.
Can I get a loan if I’m blacklisted
In South Africa, if you have bad credit or are on the financial blacklist you have a better chance of securing a loan if you supply collateral. … Consequently, the lender will be more willing to lend you money. You will also most likely secure a lower interest rate.
What is a bad credit score
A credit score is a number ranging from 300 to 850. This number shows how good your credit rating is. It depends on positive or negative information found in your credit report. This information includes:
- amount of money that you owe;
- payment history;
- activity on a bank account;
- The age of your accounts; and
- Verifications of your creditworthiness
Also, your credit score simply shows all your good/bad financial behavior.
How does being blacklisted affect you
Being on a blacklist can stop you from getting a loan to buy valuable assets like motor vehicles, property, or even starting up a business. Yet, being on the financial blacklist is nothing to be ashamed of. A great number of professionals have found themselves on a credit blacklist at one point or the other.
Am I going to be blacklisted forever
The answer to this question depends on whether you are taking the necessary steps to repair your credit history or not. This determines how long you will stay blacklisted.
How do loans for the blacklisted work
Lenders specializing in blacklisted loans work on a golden rule. If there’s a default on any of the payment terms, they are covered by the value of the assets you have pledged as collateral. They may confiscate and sell the valuables to cover the cost of the outstanding loan plus interest.
What type of loans can I get if I am blacklisted
As stated earlier, being blacklisted doesn’t mean you have been totally worthless. There are still a few credit services you can enjoy. Some of these credit services include;
Some private lenders offer short-term microloans for blacklisted people. This is a form of unsecured personal loan, but they often come with hard conditions and higher interest rates. It becomes quite difficult to borrow an enormous amount because paying back the interest plus the loan amount can become too exorbitant.
These types of loans are the easiest to get by blacklisted people. With this type of credit, the borrower has to provide an asset that belongs to them as collateral or security. This is so in a situation of default or breach in payback terms, the lender reserves the right to claim the asset.
You can get this loan against your car, landed property, or more. However, it is important to note that you risk losing your property if you don’t pay back the loan amount.
P2P Loans for Blacklisted
This form of loaning system is gaining popularity among South Africans and gaining momentum. P2P platforms allow you to obtain a loan directly from a private individual without relying on a bank or other credit provider. As different lenders specialize in different types of credit, there are no specific financial requirements for getting finance.
In order to prevent further damage to your credit, you must still make a commitment to repay your principal plus interest and fees on time and in full.
Financial providers that grant loans to the blacklisted
Here is a quick list of companies that offer loans to people with bad credit.
ATARA finance is one of the best credit providers that offer bad credit loans. They offer easy and convenient ways to apply for bad credit loans online. With a high approval rate and minimum info required, ATARA offers a minimum loan of R1000.00 and a maximum of R300 000.00. So, are you struggling to get a loan with bad credit, stress no more than ATARA loans, got everything you need, and more.
Lime loans operate with a team of highly trained personnel and a combination of machine and technology. They’ve built the platform uniquely to serve their clients, even clients with bad credit.
Are you in urgent need of finance but have a bad credit score? Ezi Finance can hook you up with a credible lending institution. Ezi finance acts as an intermediary between borrowers and credit institutions. With Ezi Finance, you don’t have to be running around sourcing for the best loans for your needs.
Other financial providers that offer bad credit loans include;
- Nexcap Finance
Before actually applying for any of these loans, be sure to do your personal check on the terms and conditions of each of the companies. It’s wise to weigh all the options and choose the best of them.
How long can you be blacklisted
Unless a court of law rescinds the judgment before this time, this judgment will remain on your record for five years. You can avoid negative information appearing on your credit report by paying off the debts that appear on your credit report on time. In addition, this can improve your credit score.
How do I get off the blacklist in South Africa
Upon having paid the debt for which you were blacklisted, the National Credit Act (Act 34 of 2005) stipulates that you have the right to apply to have your name removed from the credit bureau where you were listed. To do this, you need to apply for the cancellation of that blacklisting
Make sure you know what the loan costs and what the installments are. You should look for an alternative solution if you find the loan quite difficult to repay with your current income and monthly expenses.
To repay existing debt, you should avoid getting into further debt unless you are undergoing debt consolidation, debt management, or debt counseling with the assistance of a professional.
If you find yourself in a financially tight corner and in dire need of credit service, but you are on the “blacklist”, do not give up hope. There’s a score of financial service providers out there that will provide you with the finance you need.