How to Repair Your Credit Profile and Repay Your Debts...Faster
Being deep in debt can truly cause serious life changing events to occur. Divorce a blacklisting or even a judgement are some of the major repercussions that debt can lead you to.
Find out today the real truth about the credit system, how it works and how you can overcome your bad debt in order to become a home owner. | 
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Dear Home Seeker
I know how it feels to be put on the ‘naughty list’ where banks and large retailers brush you off as if you are a bad person who is good for nothing! Even potential employers will frown upon you if you have been blacklisted or worse so if you have a court judgement against your name.
So what can you do to empower yourself and not only fix or improve your credit record but qualify for a bad credit home loan?
I know how it feels to be put on the ‘naughty list’ where banks and large retailers brush you off as if you are a bad person who is good for nothing! Even potential employers will frown upon you if you have been blacklisted or worse so if you have a court judgement against your name.
So what can you do to empower yourself and not only fix or improve your credit record but qualify for a bad credit home loan?
7+ Steps To Paying Off Your Debts and Improving Your Credit Profile Using the Snowball Strategy
Learn how to pay-off your debts in half the time and negotiate the capital you owe.
If you follow this plan methodically and strictly you will find that you can very quickly not only pay-off your debts but you will also free up more monthly cash for yourself! Most say this debt repair strategy is too simplistic and there is much more to paying off your debts, however I have summarized debt repayment down to the very basic core of what is required in order for you to be successful. The road to debt repayment based on your current income can be a painstaking one. The obvious solution to chopping down debt quickly at the knees is to either increase your current income or reduce your monthly expenses as soon as possible. Below I have listed 7+ steps to follow to assist in reducing short term debts that are smothering you. Short-term debts excludes your home loan off course! |
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The Truth About Fixing Your Credit Record
If you have ever used a store card (Edgars, Truworths, Pick n Pay etc…) or credit card (Mastercard or Visa) then your record of purchasing and repayment of that debt is recorded at one of the credit bureaus.
The credit bureaus are independent companies that aim to operate in accordance with the law and provide a credit service to subscribing businesses. There are two major bureaus in South Africa that gather information regarding your repayment habits in order to build your individual credit profile namely; Experian and TransUnion ITC.
Whether you pay on time, late or not at all, every movement that you make with regards to your payment habits will be stored and updated at the credit bureaus.
Take note: - Due to the fact that the bureaus act independently and their subscribing base of businesses varies, you will find that it is very common for your individual credit profile to differ between the bureaus. You can easily repair your own credit record however if you feel that the debt is too heavy a burden to bear then perhaps seek the guidance of a debt councillor. Most people struggle to consistently manage their finances so it may not be such a bad idea as the debt councillor will assist in implementing a strict plan.
A word of caution though; the debt councillor you nominate to manage your money will ultimately be charging you for their services which again they will add to your existing debt burdens, albeit 'hidden' to you.
In the event you decide not to follow the debt councillor route, I have put down some pointers and basic information that proved to work wonders for me in the past. Why not educate and empower yourself with my powerful and proven 7 point debt reduction plan.
The credit bureaus are independent companies that aim to operate in accordance with the law and provide a credit service to subscribing businesses. There are two major bureaus in South Africa that gather information regarding your repayment habits in order to build your individual credit profile namely; Experian and TransUnion ITC.
Whether you pay on time, late or not at all, every movement that you make with regards to your payment habits will be stored and updated at the credit bureaus.
Take note: - Due to the fact that the bureaus act independently and their subscribing base of businesses varies, you will find that it is very common for your individual credit profile to differ between the bureaus. You can easily repair your own credit record however if you feel that the debt is too heavy a burden to bear then perhaps seek the guidance of a debt councillor. Most people struggle to consistently manage their finances so it may not be such a bad idea as the debt councillor will assist in implementing a strict plan.
A word of caution though; the debt councillor you nominate to manage your money will ultimately be charging you for their services which again they will add to your existing debt burdens, albeit 'hidden' to you.
In the event you decide not to follow the debt councillor route, I have put down some pointers and basic information that proved to work wonders for me in the past. Why not educate and empower yourself with my powerful and proven 7 point debt reduction plan.
Register and get your FREE real life case study and a Mini Course!
1. Change Those Nasty Habits
Yes, it should be obvious but needs to be stated again and again until you get the point. However painful it may seem you have to get to this point of reality. Spending mostly has been proven to be an emotional decision so changing some obvious daily or weekly 'spending' patterns may be required to kick the "habit".
You must realise that all your efforts to reduce your debts will be null and void if you do not stick to spending according to a budget and spending plan. 2. Draw Your Free Credit Reports from the Credit Bureaus
a. Yes, I said FREE. By law you are allowed to receive 1 free credit report every year in the month of your birth date. If your birthday month has passed then you can still easily purchase your own personal credit record report for a minimal fee (less than R60). The two most popular companies are TransUnion or Experian.
b. You need these reports in order to get a clear picture of your public credit profile and how the world assesses your finances. Outline who has listed you and whom you have defaults with. Your only goal is to focus on the companies that have adverse information on your name. If you don’t understand what the report means then call the credit bureau call centre and ask for a more detailed explanation of what each indicator means. 3. Carefully Work out your Monthly Expenses, Budget and Debt Repayment Sheet
Detail all your outgoing payments in the following manner.
Once you have drawn up your list of debts in excel preferably, the next thing you need to do is work out the duration each debt will take before it is fully paid off at the current rate of repayment.
Now that you have your debts and durations clearly marked out, sort the information with smallest duration at the top. In the example given the Credit card will be paid in the shortest term (13.3 months) so this should be the first one that you should most likely work on first.
Consider "what-if" scenario's in order to clarify your strategy best. Like what if I were to be able to pay in an extra R200 on the credit card? How would this change my "debt landscape" at the moment? Where could I get this extra money from? (NB: don't short pay on one loan to do this though!)  Register and get your FREE real life case study and a Mini Course!
b. Some debts may be literally handicapping the entire process so you may have to temporarily re-negotiate lower temporary (6 months) repayments with one or two creditors in order to free up more cash that in turn can start paying off other easier debts quicker. Be warned though that you must calculate the full impact of this before doing so as you may just land up compounding your original problem even further later in the future.
c. Re-negotiate a better interest rate with the current creditors. Don’t be shy to request a better interest rate. Accepting ‘No sorry we can’t do that for you’ should not deter you. Using your weak financial position (which is true) as ammunition can get you further than you think. (this option is preferred over option ii above) d. Arrange for the interest to be halted permanently! If you are in a stage where your debt may have been handed over to an attorney then try to stop or at least reduce the compounded interest rate you are being charged. This may seem impossible and depending on which institution you are dealing with it may not work, but I have personally seen this work so don't discount this option! Again if you don’t try you will NEVER know! 5. Execute and Compound your Repayment Plan
a. Now that you have re-negotiated your repayments, reduced or stopped compounded interest and worked out how to increase your monthly cash-flow the next thing you will need to do is actually start paying according to the plan.
b. The first rule is to pay-off the first debt according to the shortest duration. Once you feel the satisfaction of paying off the first debt you also will have established a good debt repayment habit and mindset.
d. Notice how in another 8.4 months you will be free of the short term loan and now able to finally pay-off the final car debt even quicker! By that time you should be able to add an additional R1650 to the car repayment.
Step 5 is a clear example of how you effectively have rolled your debt in using the snow ball strategy and compounded the payments in your favour. 6. Credit Listing Removal Please
Important Note – Before you start repaying your first creditor off faster than they expected, contact them and try (nicely) to negotiate with them that in the event that you pay off this overdue account quicker than even they expected that they agree to remove your adverse listing in its entirety! They are not obliged to, however having a fair discussion, reduced to writing can make all the difference for you in the long run (again, this doesn’t always work but try hard to do so as it will save you time.
Mention the fact that their payment is one of the most important ones to you and that you really wish to honour this payment (as you do) and set things straight as soon as possible. 7. Negotiate Lump Sum Debt Payments Down
a. Cash is king! If you have some capital available you have a strong chance of being able to get a 30%, 40% or greater reduction off the total balance you owe. This usually has more effect when someone else like a debt councilor, lawyer, willing friend or family member does this for you as they can come across in an objective and problem solving manner to the creditor.
b. Not every creditor will agree to a reduction however some will agree if you have a valid and strong case as to why you cannot repay the full owing amount any longer. The time frame that the money has been outstanding plays an important role in this decision though. If you have a old debt that you were not consistently paying over a long term you are more likely to be able to negotiate this type of arrangement. c. Once you have negotiated your debt down and done so in writing then also request that once you repay the newly agreed amount off that they please remove your negative listing from the credit bureau's. |
Repeat until Complete!
Once you have repaid the total capital off of the first creditor then start with step 3. again and again and again until you succeed with all your debts a. You will soon realise that the following is happening.
i. You are paying off and closing accounts with creditors faster and faster (snowballing) once your money gathers momentum and compounds
ii. You are getting your name cleared as you go along because you were smart enough to request that your creditor please clear the adverse information in your credit listing as soon as it is repaid.
iii. You are freeing up more and more cash flow every month.
i. You are paying off and closing accounts with creditors faster and faster (snowballing) once your money gathers momentum and compounds
ii. You are getting your name cleared as you go along because you were smart enough to request that your creditor please clear the adverse information in your credit listing as soon as it is repaid.
iii. You are freeing up more and more cash flow every month.
Let Me Show You How Easy It Is To Buy Your Home Without Using the Bank!
My powerful secrets have finally been revealed and I will show you how to buy almost any house in any area in South Africa!
This is despite being blacklisted or having limited cash, or having ITC issues. Yes, this is a pretty bold statement! I have to back it up with something and I am going to show you how, but this means you will have to spend some time here. Therefore, if you really want to own a home using this powerful technique then you need to read further. Read more about the Lease Purchase Training Course |
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