Having a good credit record is an asset that should not be underestimated, as securing finance at a moment’s notice could prove invaluable if times get hard. However, bad credit has a tendency to creep up on you when you least expect it. So, just what steps can you take to preserve your stellar credit record?
When applying to a bank for finance, you are not only subjecting yourself to slow admin and response time, but are also simultaneously putting your credit rating under intense scrutiny. This is especially true when applying to multiple banks at once for a range of different items. In order to preserve your hard earned credit score, it may be a better idea to avoid taking out further credit with financial institutions altogether.
Keep Things Stable
Constantly moving houses or changing jobs will reflect poorly on your credit score, as any sort of lifestyle volatility is met with disapproval by credit institutions. This is also true when it comes to opening new credit accounts. Opening a flurry of new accounts in a short space of time will be taken as a sign of unpredictability, especially if your credit history isn’t particularly long when you do so.
Actively Track Your Credit Report
While it’s not widely known, in South Africa, we are all entitled to one free annual credit report. This represents an ideal opportunity to review your credit records and accounts, and assess just which credit expenses are necessary and which can be eliminated. Although you may not have bad credit at the moment, you could pro-actively target the problem areas of your credit report before they become an issue.
A good credit score really is something to be proud of, however, it’s easier than you think to slip into the clutches of bad credit. Fortunately, the above steps should go a long way towards ensuring that all of your hard work thus far isn’t undone by some poor credit decisions.
If you do find yourself blacklisted or with a bad credit record when applying for vehicle finance, don’t despair as there are always options available to you, like the rent-to-buy programme. As long as you meet the qualifying criteria (R12 000 monthly income and a minimum deposit of R15 000) the chances are that we can get you back in the driver’s seat sooner than you think.