DebtSafe FAQ's

Q: How Long After Receiving My Clearance Certificate can I Apply for Credit Again?

A: There is no better feeling than receiving your Clearance Certificate (the proof to show that you have fixed your debt – an accomplishment that you have worked so hard for).

But, there are a few things that you should know before applying for credit again/after receiving your Clearance Certificate. One thing is certain – you should not rush into taking on more credit/debt again.

First things first – in theory, you should be able to apply for credit within a week of receiving your Clearance Certificate. But, we have seen that the process to clear your record can take longer than expected.

After the credit bureaus receive your Clearance Certificate each account in your Payment History should have a “Paid-Up” or “Closed” status. The credit bureaus will also make sure that your default listings and judgements against you are removed in the process. You will need to allow time for the credit bureaus to update their records. Give it a month after you have received your Clearance Certificate to see if the credit bureaus have deleted the Debt Counselling flag from your profile. If you see any discrepancies, take it up with the credit bureaus as soon as possible. Do note – according to the National Credit Act (NCA) your payment history is the only record that will remain on your credit record for two years.

On another note – credit providers do not always assist a customer who has come out of debt review directly. It is, therefore, important that you rebuild your credit score again first before borrowing from creditors. Your credit score will take some time to become good – as time passes your credit score will improve, and by a few months, it will be in a much better standing (but you don’t have to wait that long to apply for credit). We would suggest waiting three months before applying for new credit. It is important that you make sure that your credit score is good before applying for new credit because if your application for new credit gets declined, it negatively affects your credit score. It always remains the decision of the credit provider whether or not they want to extend credit to you. If they decline your credit application, you have a right to know exactly why they declined it.

Lastly, it is important not to take on too much debt or credit while improving your credit score again. We suggest that you start with small credit amounts (like a store account, for example). You, therefore, need to make sure that in order for you to improve your score or record, you must continually work on a personal debt management plan to make sure you service all of your obligations. Managing your debt is now more crucial than ever to avoid falling into over-indebtedness again.

IMPORTANT THINGS TO REMEMBER THAT WILL HELP YOU ALONG WITH YOUR NEW CHAPTER & FINANCIAL JOURNEY

**Here is a short-to-the-point illustration of a few crucial Do’s and Don’ts that you need to consider after you receive your Clearance Certificate:

DO’S –

Check your credit record one month after receiving your Clearance Certificate. It is essential to know whether your credit profile has been updated so that you can start improving your score as soon as possible.

DON’TS –

Ignore checking your credit record after receiving your Clearance Certificate. Rather not make assumptions…

DO’S –

Follow up with the credit bureaus if the Debt Review flag & default listings have not been removed within the reasonable time frame.

DON’TS –

Play the ‘ostrich’ and think that your listing will remove itself without communicating or following up with the credit bureaus.

DO’S –

Gradually build your credit score up before taking on new debt.

DON’TS –

Rush taking on new credit immediately after you receive your Clearance Certificate. You don’t want a creditor’s decline to affect your score negatively.

DO’S –

Apply for a small credit to help rebuild your credit score/improve your credit record.

DON’TS –

Take on more credit than you can afford, for example, high-interest debt.

DO’S –

Realise that it is the creditors’ choice to grant credit to you or not. If you get declined, you can ask for proof of ‘why’ as it is your consumer right to know.

DON’TS –

If you apply for new credit and get declined. Just take it on the chin and accept the feedback or outcome.

DO’S –

Continually implement your personalised 5 Step Debt Management plan to make sure you take on what you can afford and avoid over-indebtedness.

DON’TS –

Neglect managing your debt continually, or not setting a plan to keep your finances on track and your debt in check.