What are the Consequences of Getting Blacklisted?

If you’ve heard about the term “blacklisting” before, but aren’t sure what to make of it, the first thing you should know is that you shouldn’t find shame in experiencing such an unfortunate occurrence, with regards to your financial situation, whatsoever.

The truth is, South Africa is experiencing a lot of financial stress at the moment and that you’re not the only one that must find alternative methods to either pay for your debt or declare that you can’t pay for it otherwise.

Getting blacklisted is something people dread, and it occurs when you tend to fall behind on payments, especially credit-related payments. If you are blacklisted, for instance, you won’t be able to open an account at a clothing retailer.

What does it mean to get blacklisted in South Africa?

Getting blacklisted in South Africa will prevent you from continuing to continue or extend further lines with your credit providers. They will also reject any type of credit application, as their reasons are based as a response to people that are blacklisted, which is the fear that consumers won’t be able to make payments on their accounts, as they should.

If they, on the other hand, grant you debt, you would be considered high risk and won’t be allowed much credit to begin with until you’re earning more money, or your blacklisting period is over, and you’ve found a decent job.

Blacklisting is a general term, which applies to many different situations for the credit consumer. When you’re blacklisted, you could have judgment against you, when you’re trying to obtain a loan or any line of credit.

Those who are blacklisted and manage to settle their debts will still have a profile that is somewhat tainted for two to five years.

The association of blacklisting and being in Arrears

If you fail to make payments that are scheduled according to installments by your creditors, it will show up on your credit records, without legal action being taken against you.

During the period of your account being in arrears, you will be able to consult with your credit provider to arrange for a suitable date to settle your debts or catch up on payments. This usually involves an administrative fine but is far better than getting into trouble.

If you are really struggling with debt, you should consult the Debt Mediation Association, which is a non-profit organization that can help you find a means to resolve your debt.

Get debt counselling and debt review help from Credit Matters. Call us today! 086 111 6197