Have you recently undergone debt review? You no doubt feel liberated and are eager to start anew. However, you may be wondering when it’s safe for you to apply for credit again.
Although you can apply for credit once you receive your clearance certificate, there are a few important steps and timelines to keep in mind to avoid any setbacks. Let’s take a look at what you need to know about applying for credit after debt review in South Africa.
You Must First Have A Clearance Certificate
The first thing you’ll need to do before you can even think about applying for new credit after being under debt review is to successfully complete the process and obtain a clearance certificate, known as Form 19. With this document in hand, you can prove that all your debts included in the review have been settled and that you’re no longer under debt review.
Without the certificate, your status won’t change at the credit bureaus, and you’ll still be flagged, which can prevent you from getting any credit applications approved.
Give It A Few Months For Your Profile To Update
Even after receiving your clearance certificate, it’s advisable that you wait around three to four months before applying for new credit. Credit bureaus need time to update your profile and remove the debt review flag from your record.
If you are not patient and rush the process, lenders might still see you as being under debt review, which can lead to unnecessary rejections. You can use this time to monitor your credit reports and ensure that your record accurately shows that you are debt-free.
Rebuild Your Credit Score Before Applying
With your debt review status officially cleared, it’s still a good idea to approach new credit cautiously. Perhaps you should start small by opening a store account or applying for a secured credit card.
Once you do get approved, always repay the full amount on time every month to avoid running into trouble again. Doing so can help to slowly rebuild your credit score.
If you use your credit responsibly, you can get a bond, a personal loan, or a car loan in the future thanks to your new, healthy credit record.
If you’re facing a financial crisis, don’t wait. Contact us at Pioneer Group today for professional debt counselling and debt review services that can help you regain control of your finances and move towards a brighter, debt-free future.