Can you prove that you know what you’re doing and can be trusted with money?

Your credit score tells people how much you owe and whether you are over extended. It tells them whether you are a good payer of your debts and whether you pay on time and the right amounts.The amount of debt you’re carrying is 30 percent of your credit score. So your credit card balance impacts your credit score. Having big balances can hurt your credit score.

Credit providers use your credit score to measure their risk in taking you on as a client. Based on this, they approve or decline your application for credit, or for an increase in your credit limit.

Your credit score is calculated by a credit bureau. While it is based on your credit report, it also takes account of how you pay your bills.  How much debt you have and – importantly – how all that compares to other credit active consumers. 


Credit scores don’t get the attention they deserve and we don’t realize how important they are until we go to get a loan.  It’s then we realize we’ve somehow ruined it. Credit scores are one of the only ways for lenders to assess a borrower’s risk. This can mean the difference between not qualifying for the loan, but also paying hundreds to thousands more in interest.  It’s important that you work on keeping a clean credit file.

The most crucial role that credit ratings play in finances is in the interest rate. If you have a poor or bad credit rating, you are going to pay a much higher interest rate.  When it comes to buying a house, your credit score can become one of the most important numbers in the process.


Check your credit report: Credit bureaus do make mistakes. Make sure that all the information in your credit report is yours and is accurate. Alert the credit bureau if you find any discrepancies.

Pay on time: Your payment record has a big influence on your credit score. Even paying a few days late can influence your rating. If you have to pay regular installments, consider setting up a debit order, so you don’t forget and miss a payment. Or put a reminder in your diary or calendar.

Reduce what you owe: Use the credit report to list all your debts. Arrange these according to the interest rates charged on each. Try to pay off the ones with the highest interest rates first. At the same time, maintaining the minimum payments on your other accounts.

Pay off debt rather than move it around: Limit revolving debt such as credit cards. Don’t apply for more credit or accounts or increase your available credit as this could lower your credit score.

Tell creditors if you have a problem: Keeping your creditors informed if you’re having difficulties won’t improve your credit score. If you can negotiate a payment schedule your score should improve over time.

Outstanding debt will stay on your record: If an account is overdue it will affect your score. Making some payments or paying it off completely won’t clear your credit record, but will improve it.

Be aware that information about your payment profile can stay on your record for up to five years.

Closing an account doesn’t make the payment history go away. This will still reflect on your credit score.

By law, every South African is allowed to get one free credit report, every year. There are endless stories of people checking their credit reports to find errors or fraud in them. Sometimes people check their credit reports to find that someone’s taken out a loan in their name. Now their credit score is shot to shit. You have the right to force the credit bureaus to correct any errors against your name.  As long as you can prove that they’re errors. So, get your credit report every year.

There are a couple of credit bureaus that operate in South Africa that provide these reports. They all have pretty much the same information about you. Pick one and order a report on their website. 

Are you ready to Crush your Debt?

Crushing your debts is key to your financial success.The decision to get yourself out of debt is a life changer, if you are willing to make the necessary commitment that goes with that.

Join the Get out of Debt Challenge




You may have to pay to get your credit score and/or a complete credit history. It will be worth it and could be the difference of you getting that loan or mortgage you are hoping to get.  Below are a few places you can check out to get your personal credit information:

Have you recently checked your credit score?  It is suggested that you do this annually, so if you are behind, be sure to check it out today.

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