Short term loans are hard to come by if you have bad credit or are blacklisted. Many financial institutions will most likely turn you down if they find that you have bad credit, or they will charge you an exorbitant interest rate for the short term loan.
Try and minimize your chance of being rejected by making sure that none of these apply to you:
- You must not be self-employed as this shows that you are getting an irregular amount of money per month and may struggle with paying the lender back.
- You must not be under administration or under debt review. This is self explanatory as if you are still under debt then you may get into more debt through loans.
- You may not currently be under sequestration or in the process of being liquidated.
If you are permanently employed, receive your salary into a bank account (monthly or fort-nightly), have been employed for more than three months (this is lender dependent) and are a South African citizen, then your application will be considered with major credit providers.
Blacklisted people often get turned away from major financial institutions that are weary of giving personal loans to people with a bad credit record. This has, of course, an effect on the personal lives of such people.
You can still get a personal loan if you are blacklisted or have a bad credit record. This is because smaller financial credit providers are more inclined to grant you a loan as they are less restricted and have more flexible policies. They are by law required to abide to the National Credit Act, 2005 (Act No. 34 of 2005) so don’t go into a financial credit provider’s office expecting them to break ethos and laws of the country.
Now, here are certain things you need to know in order to have the best chance to acquire that much needed personal loan.
- You will certainly attract a higher interest rate because you are still considered a risk. The interest rate is one of the first things you will need to inquire on, so shop around for the best rate.
- You have to have been permanently employed with your current employer for a period of more than 2/3 months, receive a salary into a bank account and have a salary slip.
- Be a South African citizen.
A lot of these institutions will most likely turn you away if you are:
- Self employed
- A commission earner only
- Under administration or debt review
- Weekly or fortnightly paid
- A Pensioner
How much can you acquire? Well, it really depends on the lender and you. Some lenders will go as far as R 200, 000 or as low as R 1000, but will depend on how comfortable you are with the interest rate they will charge you. They also will look at your own debt record. The most important thing is to make sure you can pay back these monies.
Be at the ready with documentation such as the last 3 months bank statement, South African ID, payslip and proof of residence. There are still institutions willing to grant loans for blacklisted people and your search should not end with the banks.