Get your credit turned around!!!

As a South African resident, knowing the meaning of blacklisting and how it can effect you financially is very important. Here are few tips you can follow to stay out of the trap and to be able to cope should you find yourself blacklisted.

When you are blacklisted, you are put on a list of people who have been determined to be a credit risk because of past nonpayments of financial obligations. Don’t worry, though. This is not a personal blemish, but a business one. Lots of companies and even wealthy businesspeople end up on the list. It just means that there has been a problem that raises concern about credit worthiness. Actually, it has been reported that as many as twenty-five percent of all South Africans are on a credit blacklist.

People often overlook the fact that they are on the verge of financial problems by not being organized and keeping up with their obligations. Missing payments, late payments and letting loans go into default are all ways that you can get yourself put on a blacklist.

So you may be thinking that if you are on a credit blacklist, your dreams of owning a home are dashed. While it will be much more difficult to mortgage a home when your credit is in the gutter, there are things you can do.

First, make sure that you are currently able to meet your financial obligations. What was the cause of getting put onto the blacklist to begin with? Were you out of work? Too many bills piling up? Procrastinating to pay your bills? You first need to make sure you have taken care of your problems and that you are back on your feet before adding new financial obligations to your plate.

After that, you will probably have to pursue alternate avenues for getting your new home financed. The banks are going to look at your credit score, see that you are on the blacklist and slam the door in your face. And it can take years to get your credit back to a point where a bank will take a chance on you. Ask relatives to borrow money. You may have a wealthy uncle or aunt who could put up the capital. The benefits of borrowing from a relative is that they know your circumstances better than the loan officer at the bank, and they know whether you really are capable of paying back the loan.

Another option is to seek financing from a private investor. These are groups of private individuals who collectively pool their money to offer funds or investments in return for the interest made on the loan. Private investors do not have to follow all of the strict requirements that the banks have to follow, but they also sometimes require that you own a high percentage of equity in your new home if you have a poor credit score. Consequently you may have to pay a higher premium on your mortgage insurance.

Once you secure a loan from a private source, make sure you pay back regularly. There is nothing that will put you deeper in the hole like burning a creditor who took a chance on you while you were down and out. Any future lender will look at this and see that your claims that you were just going through a bad spell were baloney. You just don’t pay your bills.

Finally, you need to get your credit turned around if you want to get off of that blacklist. This can take years, and so it involves a certain degree of acceptance. You just have to plug away at paying your bills and don’t think about it too much. Eventually one day you will realize that you have been a good payer of all your obligations and that you are finally off of the bad credit list. This is a welcome feeling, especially when it sneaks up on you.

For further information contact Morne Prinsloo on 011 327 4489 or email morne@mortgagepluscc.co.za

If you would like to know more about your home loan services and mortgage requirements please phone the Mortgage Plus Head Office on:

Attached please find the Home Loan Application Form * - Short Home Loan Application Form

0861.11.11.93

info@mortgagepluscc.co.za

www.mortgagepluscc.co.za

How can we help you – Property Finance – Mortgages?

Buying a home is admin-intensive and we will make sure you know exactly what documents are required for your new home loan or first time buyer loan and when to make the deal happen for you.

What assessment factors do the banks look at?

Affordability, credit worthiness, and property value come into play when we assess your application.

1. Affordability
At this stage, the bank will undertake a comprehensive assessment to determine if the loan you apply for is affordable to you. Your credit history will be put under the spotlight and details of your current credit facilities will be sourced from a credit bureau. This way we can independently verify the instalment amounts for credit cards, vehicle repayments, cellphone contracts and other facilities in your name. It’s a step that has your best interests at heart. We do what we can to ensure you only take on debt you can afford. Never be untruthful about your income or expenditure as it can lead to your application being rejected.

2. Credit worthiness
A good credit history counts in your favour when applying for your home loan. Credit bureaus do not only list defaults or judgments against you but also keep record of good conduct on your accounts. If your conduct shows you to be a good risk client, you may be offered a preferential interest rate. This can save you a substantial amount of money over the life of your home loan. Your application could be rejected if you are considered a high risk client based on your credit history.

3. Property valuation
It is the norm for the bank to conduct a valuation on the home you intend to purchase. This is to make sure the property offers sufficient security for the loan you request and is of the type the bank normally finances. The bank may require you to pay a deposit on certain properties.

On approval of your home loan application, we will contact you to discuss the most favourable rate received from the banks as well as other important details and the terms of the loan. At this stage, I will advise your estate agent that the purchase of the property has been concluded and I will forward the necessary documentation to the attorneys to proceed with the registration of your bond and transfer of the property into your name.  The attorneys will contact you to set up an appointment for the signing of these documents.

If you would like to speak to a Professional Mortgage Specialist about your lending requirements, please phone Mortgage Plus Bond Originators on:

Complete this short form online

011.327.4489 / 0861 1111 93

morne@mortgagepluscc.co.za

www.mortgagepluscc.co.za