What can you expect to learn in the credit health education series?
Key Outcome: Learning how to read and understand a credit report will give you the power to know exactly what your credit status is, and what financial and credit potential you have available.
When used responsibly, credit can be a helpful financial tool. Whether it’s taking out a home loan, securing financing for your business, or buying a car with manageable repayments. Access to credit can also help you deal promptly with unexpected, costly emergencies and can offer peace of mind when travelling.
But, when not managed correctly, credit can also lead to crippling debt. It’s important to understand how credit works so you can use credit responsibly. Using credit wisely will help you establish a positive payment history and open up doors to take advantage of future credit including car loans, home loans, credit cards, and personal or business loans. Your credit habits will directly affect your credit report and credit score, which, in turn, impacts everything from future insurance costs to employment opportunities, and housing options.
Ready to get started? Let’s get going below.
Shortcut to the articles in the credit health series
Article 3 – Credit Report Red Flags and Problems
1. How to spot mistakes on your credit report
Basic Details
It’s important to read your credit report carefully. Double-check the basic details to ensure everything is up to date and that the information listed in this section refers to you, and not someone else who happens to share your name. Make sure all the addresses listed are places that you’ve actually lived.
Accounts
Make sure the details listed in your credit history are correct. Look for accounts that were opened and query anything that sounds unfamiliar. Furthermore, check for payments being noted as late when they actually weren’t.
If you’ve closed a credit card account, confirm it’s showing up as closed on your credit report. Also, make sure no lines of credit have been opened in your name without your consent. If you spot an account that is unfamiliar you could be the victim of identity theft.
While it is pretty rare to find an error in the part of the public record of the report, it is worth scanning and checking the details. Mistakes in this section of your report should be cleared up as soon as possible.
Inquiries
Under inquiries, check that all businesses that have done a hard inquiry on your credit history have been requested to do so. While inquiries may seem harmless, hard inquiries, especially ones that have resulted in a line of credit being rejected, can cause your credit score to drop a few points. It’s important to double-check this section to make sure you’ve actually given your permission for a hard inquiry into your credit history. These inquiries should disappear from your credit report after about two years.
It’s surprising how many Fincheck users complain of incorrect information on their report! This is why we offer you a free credit score when you sign up with MyFincheck here. You will also be able to purchase your full credit report from some of the best credit bureaus in South Africa right from your dashboard!
Remember, false information can lower your credit score. A lower score will make your future applications for credit much harder. Take the time to study your credit reports so you can make better financial decisions!
2. How to correct outdated accounts and judgements
Any mistakes on your credit report need to be taken up with the credit bureau that shows the error, not the credit report reseller. Send the written communication to the credit bureau listing each incorrect item you found on the credit report and why you’re disputing it.
For example, if the credit report lists a credit card you’ve closed as an open account you will need to notify the bureau in writing. Gather up documents and any evidence you might have to prove it is a mistake. The agency has 30 days to respond to your objection and rectify the error. It’s also important to note that credit bureaus update their credit reports every 45 days. However, it does depend on the information supplied by the lender.
Where to get credit bureau details?
Below is the latest contact information from each of the key players in the credit bureau industry.
TransUnion Credit Bureau
Contact TransUnion on 0861 482 482 or click here to contact support.
Experian
Contact Experian on 0861 10 56 65, email EZA.consumer@experian.com or click here to contact support.
XDS:
Contact XDS on +27 11 645 9100 (JHB), +27 31 584 7379 (DBN), or info@xds.co.za. Or click here to contact support.
Compuscan (recently merged with Experian)
Contact Compuscan on 0861 10 56 65, email EZA.consumer@experian.com or click here to contact support.