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Why You Should Check Your Credit Rating Regularly

 

Checking her credit rating with DirectAxis Pulse helped Mpumi to get clarity on her debt and the best way forward. Most people don’t think about their credit rating until it’s time to apply for something like a loan. There are lots of reasons for this – they think it’s too difficult or are scared of what they might find. But it’s a good idea to regularly check in on this all-important rating.

It’s used for anything from qualifying for a loan and determining what interest rate you’ll pay, to whether a landlord will consider you to be a good tenant and if you can open a clothing account. Even future employers can request to see your credit report.

Therefore, since so many people and places have access to it, here are our top reasons why you should do a regular check on your credit rating.

1. It’s free to check

By law you are entitled to one free credit rating check every year at any credit bureau. However, a lot can happen in a year, so you can use a tool like DirectAxis Pulse to access your rating as often as you like. It’s a free and secure financial tool that allows you to check your credit rating and learn how to improve it.

2. Know where you stand – and how you can improve

You can’t improve your credit rating overnight, so if you know you’re going to apply for a mortgage in a year’s time, checking your rating now allows you to improve things in time. Knowledge is power – it’s better to know exactly what’s what, rather than face the disappointment of being turned down for a loan.

3. Early warning of any scams

Unfortunately, identity theft is rife, so checking your credit record is a good way to see if someone is using your personal details illegally or posing as you to borrow money or open accounts.

4. Stay in control of your credit rating

Regularly checking your credit profile will help you understand what factors are influencing your rating and how you can improve it. Good habits, like paying your accounts on time, can gradually increase your credit rating.

5. Find accounts that haven’t been closed

Your credit record will also show exactly which accounts you have that are still active. If you find an account that you know should be closed (e.g. a clothing store account) but it is showing as open, it could mean the bureau hasn’t received the updated data from the credit provider to show a closed account, or that you short-paid one of your instalments along the way. To play it safe, rather double-check with the credit provider that you are fully paid up and that the account will be closed. 

6. Pick up on mistakes

If you spot a sudden drop in your credit rating, you can contact a credit bureau to find out why. If there isn’t a reasonable explanation, it may be a mistake.

In summary, with great tools like DirectAxis Pulse, it’s quick and easy to check your credit rating. Plus, by better understanding how the financial world sees you, it empowers you to do something about it.

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DirectAxis is a business unit of FirstRand Bank Limited, an Authorised Financial Services and Registered Credit Provider, NCRCP20. Direct Axis SA (Pty) Ltd, Reg no. 1995/006077/07, an authorised Financial Services Provider, FSP7249 & FSP5. 108 De Waal Road, Diep River 7800.

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Loan repayment terms range from 24 to 72 months. The maximum interest rate with regards to a DirectAxis Personal Loan is 27.5% per annum (compounded monthly). Your rate and initiation fee will be determined according to your personal risk profile.
An illustrative example of a loan at an interest rate of 27.5% per annum would be: Loan amount R50 000 plus a once-off initiation fee of R1 207.50 and a monthly admin fee of R69.00, over 72 months.
The total cost of the loan will be R 110 013.57 which is a maximum Annual Percentage Rate (APR) of 30.76%.