Is a prospective lender telling you that your credit is ‘locked’ or ‘blocked’? Don’t panic! In South Africa, this is most likely to relate to a security block on your profile, usually applied after a data breach or other incident, and doesn’t mean your credit score is suddenly a lot worse than you expected it to be or you don’t qualify for credit. Today, we will look at credit report
What Does A Block on Your Credit Mean?
In most circumstances, a ‘block’ or ‘freeze’ on your credit report means that no one can access that information. This is typically done to help avoid fraud, especially in the event of a data breach around your sensitive financial information having occurred.
Sometimes, it is still used as a holdover term from the blacklisting days, implying that a ‘block’ is the reason you aren’t getting credit. Do remember that blacklisting no longer exists in this form in South Africa. If you are being repeatedly denied for credit, it is unlikely it is due to a ‘block’ on your credit score, but rather the overall poor state of your credit report raising red flags with the potential lender. Luckily, you can rehabilitate this by addressing the areas you are delinquent, making payment arrangements, and improving your credit score by paying your monthly payments on time and in full.
How Do I Remove A Block On My Credit Report?
Typically, you will need to talk to the bureau in question and request that the credit freeze or credit block be lifted from your report. You can choose to have this done for a specific lender to check your report, or have it removed altogether. The Big 4 bureaus in South Africa allow you to do this online.
Alternatively, you may need to speak to the institution that initiated the credit block to see how to resolve this. For example, if ABSA bank had a data breach, they may initiate a credit block on all potentially compromised accounts for free for 3 or 6 months automatically, to prevent fraud taking place with any compromised details. In cases like this, you would need to speak to the originator of the block to get instructions on how to lift it.
You will need to prove your identity and right to lift the block, so have supporting documents ready.
Should you find erroneous data on your credit report, like fraud which has negatively impacted your credit score, you can apply to the bureaus with proof that the charge is illegitimate, and it will be lifted within 20 business days.
How Long Does A Credit Block Last?
Typically, credit blocks or freezes will last for up to 6 months in South Africa. This is dependent on the reason the block was enacted, and who asked for it. If you asked for a temporary freeze on accessing your credit, you will have set the time on your application.
Remember, you are no longer ‘blocked’ from credit automatically if you have a bad credit score. However, your less-than-fresh score may be responsible for lenders turning down your application. Sadly, nothing but focusing on rehabilitating your credit score will fix this for you- but always remember that it can be done!
Why Is There A Block On My Credit Report?
If you have a block on your credit report in South Africa, it most likely means one of the two following situations:
- You have requested the credit block or freeze personally.
- It has been applied to your credit report by an institution that suffered a security threat or data breach as a proactive measure.
You should have been informed of the latter at the time of the security incident. However, sometimes messages get lost or forgotten, or perhaps the institution didn’t inform you correctly. So it is possible to be surprised by a credit block. Get in touch with the bureau or the institution that initiated the block to resolve the matter.
How Do I Know If I Have A Credit Block?
You should know if your credit has been blocked or frozen, as the institution that does so should inform you. However, many people only find out that the freeze is in place when they apply for credit and the new lender sees the block. While this can be very frustrating, and may temporarily set back your credit application, it can be resolved reasonably easily. Once the freeze is lifted, there should be no lingering negative effects on your credit report or history.
Encountering a credit freeze or credit block when you don’t expect one can be off-putting. However, there are steps you can take to address the issue, and they are fairly easy. So don’t panic, you will get there!
