Hi good day,
I need help.
About more then 10 years ago I had an account with one of the leading retail brands but I was unable to settle my debt due to some issues. But now I’m older, stable, and I want to solve this because when I apply for example for a home loan it returns declined because I’m a high risk.
Where do I start fixing this issue?
Thank you for getting in touch.
The first step is to pull your credit record. You can check your credit record with any credit bureau. TransUnion is the best, so we would suggest pulling your record there. By law, you are allowed to pull your credit record for free once a year. Here is a link to TransUnion’s site.
Once you have your credit record you will be able to see where the problem is.
If the last status of an account is “in arrears” and you settle it on that status, your credit score will take longer to improve. If you pay the arrears and make regular payments for 3 months and all accounts are up to date it will reflect better on your credit score.
The National Credit Act states that once your arrears are up to date the retention period for default listings is 12 months.
Regarding prescribed debt:
Debt has only prescribed if there has been no attempt by the credit provider to collect it or if no summons has been issued for the debt during the last 3 years. Also, if there has been no acknowledgement of debt during the last 3 years. If you have made any form of payment in the last 3 years it constitutes an acknowledgement of debt.
Prescription of debt is a defence; thus, if it is causing issues for you, we would advise that you get an attorney to write a letter on your behalf to the respective credit providers notifying them of the problems that are being caused by the debt and then claiming that it has prescribed. If the debt has indeed prescribed already, the new Credit Amendment Act prohibits the prescription to be interrupted after 3 years. If it has not prescribed yet, then you need to be careful not to acknowledge it.