Credit Report (Part 1)

Ever Heard of a Credit Profile Before?

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Have you been shocked trying to open an account or take new credit, only to be told that "Your Profile doesn't qualify"? Well, I've been in the same predicament too, trying to apply for a home loan and didn't even know what a credit profile was or how it works. I was shocked and saddened because I was servicing all my debts, well most times at least, so I thought I was handling them well until that very moment, which was another incident that forced me to want to learn about credit systems in South Africa.

The sad part of it all is thinking, how can I be declined credit when I don't have any debts, and I always buy things with cash? Yes, it happens, many of my clients were denied vehicle financing and other credit, even though they were not owing any debts, their credit profiles were too clean, without any debt history, which is a risk for creditors. But stay with me so we can explore the credit profile together, learn what it is, how it works, and how it can benefit you or hinder your financial goals.

Credit Profile Explained

A credit report also credit profile is like a report card for your financial behavior. It’s a summary of how you’ve managed credit, such as loans, credit cards, cellphone contracts, and store accounts over time. This profile is compiled by credit bureaus and used by lenders (banks, stores, etc.), landlords, and even employers to decide if they can trust you with money, tenancy, or employment, so you can think of it as your financial reputation. Just as you’d want a good reputation in your community, you want a strong credit profile in the financial world.

Where do I Get My Credit Profile?

In South Africa, everyone is entitled to one free credit report per year from each of the major credit bureaus which are TransUnion, Experian, Compuscan, and XDS, and can be accessed from their official websites, phone apps, or even at money markets. You may be required to register and verify your identity by providing an ID and sometimes proof of address. The credit report can be downloaded instantly or emailed to your address. Always ensure you check your report for errors or unfamiliar accounts, as mistakes can affect your creditworthiness.

Note: You don't have to have credit or loans to get credit profile in South Africa, anyone can get their credit profile from the credit bureaus. 

What’s Inside Your Credit Profile?

Your credit profile will include your personal details, your credit accounts such as  loans, credit cards, and store accounts open and closed, the payment history including missed payments, any defaults or judgments against your name, and any credit inquiries in the last 12 months.

Benefits of a Strong Credit Profile

A good credit profile opens doors for you to access credit from lenders at the best possible interest rate. It can make life expensive or cheaper for you and can limit opportunities. Whenever you apply for credit like a cellphone contract, car finance, or a home loan, the company checks your profile to assess risks, to determine whether you are likely to pay them back or not.  Your profile can also influence your rental applications and even some employment opportunities. People want to work, employ, and allow rental to people they can trust, and this is where your credit profile can either promote you or sabotage opportunities for you...

In the next post I'll show you how to use your credit profile to improve your score and take action so keep an eye out!

Thank you for stopping by. Please leave us a comment and if you've found this information to be valuable, please share it with your friends. You may also reach out to us through the contact form on the side bar. 

Disclaimer: I'm not a financial advisor. This is based on personal experience and for educational purposes only.

~Revive Your Credit, Revive Your Life