How to Improve Your Credit Score in South Africa

Considering taking out a home loan? Having a stellar credit score is important. We discuss how to improve your credit score in South Africa to get a good loan.

How to Improve Your Credit Score in South Africa
Are you wondering how to improve your credit score in South Africa? If you're in the market for a new house, having a stellar credit score is essential. It will help you secure a good home loan, and you should therefore do everything you can to improve it before submitting your application.

How is Your Credit Score Calculated?
Your credit score helps determine your home loan and is generally a number between 000 and 999. This number is calculated by considering all your debt, past payments, and other financial history and activity.

What is Considered a Good Credit Score?
Anything over 600 is considered a good credit score, but if you are above 800, you have the ideal credit score.

Our Top Tips to Improve Your Credit Score in South Africa

1. Get Rid of Debt - You want to write off any debt you can before applying for your home loan, especially when it comes to credit cards, as they have the most significant negative impact on your credit score.
2. Close Unnecessary Accounts - If you have many accounts under your name, you should settle and close those you can.
3. Comb Through Your Reports - Checking your credit reports is a quick way to see any red flags, such as falsely recorded late payments, etc.
4. Check Your Credit Ratio - What's a credit ratio? Well, it's the difference between what credit you have available and what you owe. So, if you have R10,000 available and owe R5,000, you have a 50% ratio. Try your best to get (and keep) it under 30%. 
5. Pause on Opening Any New Accounts - Avoid any unnecessary new account activity before applying for your home loan.

Calculate Your Credit Score and Affordability Online 

You can check your credit score online here and can work out your bond affordability here.

Need Help Buying or Selling a Home? Contact us today to make the process of searching and securing a home a breeze.