A personal loan and other credit can give you the help you need to achieve your dreams especially when money is tight. However, once your loan or credit application is approved and you have access to the funds, you then have to ensure that you manage the repayment of your personal loan and other debt responsibly so that you do not fall behind and get blacklisted.
However, what does being blacklisted really mean and what are the consequences thereof? In the past, when you fell behind on your loan repayments even if it was just for a month, you were blacklisted as a slow payer on your credit profile. However, this has changed over the years.
So what does being blacklisted mean in today?
A collections department might follow up with a client if a payment was missed for one month and if a payment is missed for a period of two months, a letter of demand will be issued. On the client’s credit profile it will reflect that a payment was missed. All loan amounts written off on any accounts will reflect on the credit profile as well. If payments are still missed after the letter has been issued, and no acceptable payment arrangements were made, the account will be handed over to attorneys for legal proceedings.
Legal proceedings include the issuing of a summons, followed with an application for a default judgement. In some cases, this will involve a warrant of execution to attach goods and or property. At this point, a person is blacklisted, reflecting judgement granted. The consequences of being blacklisted are that credit providers will reject your loan application. In addition, being blacklisted negatively affects your credit score which might prevent you from getting any future credit.
How can you prevent yourself from being blacklisted?
The first step is to inform your credit provider the moment you realise that you are not able to make a credit or loan payment, they will then discuss alternative payment options available to you. If you are employed at an employer that has a contract with Iemas, then you can apply for an Iemas personal loan (depending on your affordability) which will be deducted from your monthly salary. This will assist you with debt obligations and to maintain a positive credit profile.
An Iemas loan can give you the help you need to reach your dreams
We have a variety of unsecured loans available that you can apply for if you are employed at an employer that has an agreement with Iemas. Once you qualify for an Iemas personal loan, you become a member of the co-operative, which means that you get to share in our profits through our annual member rewards. Iemas rewards are based on the products you used throughout the year and is paid out during November. Find out how you can start sharing in the rewards today! Contact us on 0861043 627 or visit unsecured loan page. If your employer does not have a contractual agreement with Iemas, then find out how your employer can become part of the Iemas family here: https://bit.ly/2JjpCI2.
Read other interesting blog articles below:
- How to maintain a good credit score
- How to manage your finances responsibly
- How to save even more money on fuel
- What you need to know about personal loans
- Four ways to stop dipping into your savings account
Adapted from: https://www.ezdebt.co.za/blog/consequences-blacklisted-south-africa/