EVERYONE’S LAW JOURNAL CREDIT INFORMATION AMNESTY The time has come to say goodbye to my Monday Bulletin which is so last year - and move on up to my new creation, Everyone’s Law Journal, which is going to be much more exciting. The aim of everyone’s law is to publish, whenever time permits, legal articles of interest to the ordinary person in the street, in ordinary language (well, nearly ordinary language). I have seen so many clients falling foul of the legal system because of ignorance of laws that affect people’s lives every day. Well, I plan to educate everyone I can connect with and hope to eventually get other legal writers to make contributions to my journal. There seems to be some sort of shroud of mystique surrounding the Credit Information Amnesty which comes into operation on 1 April 2014. Well, I have it from the horse’s mouth. I had a teleconference with the Credit Ombud’s office today and they were able to paint a clear picture for me. There has been talk of a credit information amnesty for some time now and it is finally about to happen. There are four main credit bureaus who record judgments and adverse credit information on people who have defaulted in terms of a credit agreement of any sort. These agreements include bank loans, cellular phone contracts, retail store contracts, etc…the list goes on. If a person applies for credit and there is an adverse listing or judgment on their credit record, the credit provider will invariably refuse this person credit. In terms of the rules currently in place, Judgments remain on a person’s credit record for a period of five years before being removed. Where judgment debts have been paid and a consumer wishes to remove the judgment from his/her credit record, he or she will need to make application to court to have the judgment rescinded. This is an expensive process and requires professional legal assistance. Adverse credit listings and poor payment records remain for two years (one year in some instances). Judgment information is sent to the bureaus from the courts and adverse credit listings and poor payment records by the credit providers themselves. In terms of the Credit Information Amnesty which was brought into being by Government regulation with effect from the 1st April 2014, every consumer who has a judgment or adverse credit listing that has been paid up, will have their credit record wiped clean in respect of each paid up item. This process will happen automatically as all credit providers subscribing to the credit information bureaus have been called upon to provide the bureaus of records of all accounts that have been paid up. Once the bureaus process this information, the consumers in question will have their credit records cleared and will be able to enter into further credit should they so wish. The bureaus have been given from 1st April 2014 to 1st June 2014 to complete the task of clearing the credit records of all the consumers who qualify for amnesty. Note here that this process will apply to all judgments and adverse credit listings (such as write offs) but not to poor payment records and these will remain on the bureaus’ records for their full duration (two years). Consumers who are affected should check their credit records after 1st June 2014. The contact numbers of all the bureaus will be listed at the end of this article. All the bureaus offer a free credit record check once a year. Whether the credit information bureaus (and credit providers) are going to be able to achieve this monumental task within two months remains to be seen but the good news is that they are certainly going to try and my prediction is that the 1st June deadline will probably have to be extended. More good news for consumers: Later this year we hope to see the promulgation of an Amendment Bill to the National Credit Act. In terms of this Bill all judgments and adverse credit listings will have to be removed from the bureau records as soon as the debt owing has been paid and will no longer remain on the bureaus’ records for one, two or five years, as the case may be. The Credit Information Amnesty and the ensuing Amendment Bill have, predictably, been criticized by the banks and big business. My belief is that credit providers will have to be more responsible in their lending patterns and cannot simply rely on credit bureau records which often do not reflect reality. Credit providers will be encouraged to administer proper and realistic affordability checks before deciding to give credit. In this way, credit will be extended more readily to those who really need it (and can afford it) and there will be less abuse of the credit market by credit providers and consumers. Contact numbers for credit bureaus: Transunion - 0861 886466 Experian - 0861 105665 XDS - 0860 937 000 Compuscan - 0861 514 131 Theresa Avenant BA LLB
Posted on: Tue, 18 Mar 2014 18:21:25 +0000
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