{"id":631245,"date":"2022-10-05T08:38:41","date_gmt":"2022-10-05T06:38:41","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=631245"},"modified":"2022-10-05T08:38:41","modified_gmt":"2022-10-05T06:38:41","slug":"credit-where-its-due-2","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/industry-news\/631245\/credit-where-its-due-2\/","title":{"rendered":"Credit where it\u2019s due"},"content":{"rendered":"<p>While some people have the misperception that credit is bad, the truth is that very few of us can live the lives we want without at least some credit.<\/p>\n<p>That credit could be a clothing account or personal loan, or it could be a home loan, vehicle finance agreement, credit card, or some other facility.<\/p>\n<p>To get some credit types, , you first need to show that you can manage your credit correctly; and that means you need a good credit score.<\/p>\n<ul>\n<li><a href=\"https:\/\/personal.nedbank.co.za\/tools-and-services\/my-credit-score.html?cmpid=DIS_N75v3\" target=\"_blank\" rel=\"noopener\"><strong>Click here to check your credit score for free with Nedbank.<\/strong><\/a><\/li>\n<\/ul>\n<p>According to Warren Tromp, Executive for Product Development at Nedbank, most responsible lenders, like banks and other finance providers, use credit scores as a factor when deciding to offer credit.<\/p>\n<p>They also use your credit score to work out your risk profile (the chances that you may not repay your credit), which impacts the interest rate they charge you.<\/p>\n<p>\u201cYour credit profile gives lenders a good idea of how well you have managed your credit in the past,\u201d he explains, \u201cso if your score is in the upper end (660 and above), you stand a better chance of getting the credit you\u2019ve applied for at the lower end (590 or less) that shows you haven\u2019t been managing your debts that well.\u201d<\/p>\n<p>According to Warren there are a few ways that consumers can make sure that they have a good credit (risk) profile, but the most important is to consistently pay all their monthly repayments on all bills and loans they have.<\/p>\n<p>\u201cThe quickest way to damage your credit score is by missing payments, paying late, or not paying the correct amount,\u201d he explains, \u201cevery time you do that, the credit agencies will adjust your credit score downwards.\u201d<\/p>\n<p>A bad credit action can show on your credit history for months, or even years, making sure that you repay the correct amounts on time is crucial.<\/p>\n<p>There are also other credit score damaging actions you should avoid, including:<\/p>\n<ul>\n<li>Making a lot of credit applications at one time &#8211; banks take that to mean you\u2019re in financial difficulty<\/li>\n<li>Maxing out your available credit \u2013 try to only use up to 50% of any credit facility (credit card or overdraft) you have<\/li>\n<li>Having judgement or administration order against your name \u2013 these can stay on your credit record for up to five years, so you need to avoid them<\/li>\n<\/ul>\n<p>Just as there are negative credit actions to avoid, you can take positive actions to improve your score.<\/p>\n<p>Making all bill and loan payments on time every month is obvious, but others are too, \u201cMake sure you only ever apply for credit from a registered financial services provider,\u201d he says, \u201cthat way you are protected by the Consumer Protection Act.&#8221;<\/p>\n<p>&#8220;There\u2019s no risk that an unscrupulous lender could do something that affects your credit score.\u201d<\/p>\n<p>Warren also recommends regularly checking your credit score.<\/p>\n<p>\u201cMany people simply ignore their credit profiles until they need to put in a credit application,\u201d he explains, \u201cbut since having a good credit score is an important part of good money management, it\u2019s important to check your score regularly, so you can take corrective action if necessary.&#8221;<\/p>\n<p>&#8220;Thanks to <a href=\"https:\/\/personal.nedbank.co.za\/tools-and-services\/my-credit-score.html?cmpid=DIS_N75v3\" target=\"_blank\" rel=\"noopener\"><strong>Nedbank\u2019s credit health tool on Nedbank\u2019s website<\/strong><\/a> you can check your credit score for free every month, with no effect to your score even if you aren\u2019t a Nedbank client.\u201d<\/p>\n<h3 class=\"my-4\">But what if you don\u2019t have a credit history?<\/h3>\n<p>If you\u2019re starting out in your adult life, you may not have any loans or regular bills yet, so you won\u2019t have a credit profile.<\/p>\n<p>It can be tricky because you need a credit score to get many types of credit.<\/p>\n<p>For this reason, he recommends building a credit profile as soon as possible once you start working, and he says the best way to do that is by applying at your bank for a credit card or opening an account at a retail store.<\/p>\n<p>\u201cMany banks will give you a credit card with a small limit as long as you are a client and you can show that you have a steady income,\u201d he explains, \u201cthen, once you have a credit facility, use it regularly (as opposed to cash) and always pay back at least the minimum repayment amount on time, every single month.&#8221;<\/p>\n<p>&#8220;Soon , you\u2019ll have a credit profile and score, and you can start making use of other credit facilities to make good and responsible money choices and gradually create exactly the life you desire.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Why a good credit score is so important, and how you can achieve it.<\/p>\n","protected":false},"author":57,"featured_media":600360,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10459],"tags":[1799],"class_list":["post-631245","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry-news","tag-nedbank"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/631245","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/57"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=631245"}],"version-history":[{"count":2,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/631245\/revisions"}],"predecessor-version":[{"id":631249,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/631245\/revisions\/631249"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/600360"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=631245"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=631245"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=631245"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}