08 Apr ITC Clearance for Debt Review

No one wants a Debt Review lingering on their credit report, especially after you’ve worked so hard to get your finances in order. Imagine: Your debt counsellor has submitted proof you’ve paid all your debts. You walk out of court feeling free. You’re out of Debt Review, you did it! You did that. You get home and get a free credit report. Your face slackens as you scan the webpage– the Debt Review flag is still there, in all its great and terrible glory. You anxiously wonder how to rid yourself of it. The answer? ITC clearance. It’s a sort of graduation certificate from debt rehab. Your debt counsellor will give you a credit clearance certificate as proof you’ve paid your debts, which you will then submit to credit bureaus. And guess what? Credit bureaus have to clear your name. According to the National Credit Act, it’s illegal if they don’t.

Who is the ITC?

ITC is an archaic term for a major credit bureau now going by Transunion. They store all information about your credit and payment history, including; loan and credit card payments (on time or late), defaults and judgments, debt review status, and public records like insolvencies and bankruptcies. From the information in your credit report, ITC generates a credit score ranging from 0 to 850, which decides whether you can attain credit and helps lenders assess your risk.

How do you qualify for ITC clearance?

You qualify if you have a debt clearance certificate. You also need certain documents to apply, like your ID, a copy of your credit record, a clearance certificate, or letters from creditors confirming you’ve done your part. You should also provide up-to-date proof of payment on bigger debts, like a mortgage.

You don’t have to have a monstrous debt to apply, either. You apply for ITC clearance even if you have small debts to improve your credit score, a major factor creditors use to decide if they should lend you money.

Can you qualify if you haven’t completed Debt Review?

Although this is a trickier route, it is possible to qualify for ITC clearance without completing Debt Review. It involves proving you’re not over-indebted by showing evidential documents. This is where it helps to lawyer up. If the court agrees that you’re not over-indebted, they’ll issue an order to remove you from Debt Review. With the court order in hand, you can then approach the credit bureau and request them to update your report by removing the debt review flag, granting you access to a clear credit record!

NCA credit clearance regulations

The National Credit Act (NCA) is legislation that sets out both your and credit bureaus’ rights and responsibilities when clearing credit. Part 71 says:

• Upon receiving a clearance certificate, credit bureaus must remove relevant information from their records, such as debt re-arrangement details and consumer defaults.
• Credit providers must comply with clearance certificate requirements, and consumers can voluntarily apply for registration as a credit provider under certain conditions.

The Act is there to protect you both.

What happens after you submit a clearance certificate?

Usually, it takes about 3 months for credit bureaus to process everything and give your credit record a makeover, making it all clean and shiny.

• That Debt Review flag begging for attention takes a hike.
• The default on your report, the one throwing you so much shade, fades away. They’re fully erased, or at least marked as settled.
• Your payment history remains. Don’t panic, it’s a good thing! It’s your credit score’s best friend, which illustrates you’re financially responsible and good with money.

Your credit score goes from being a hot mess to the poster child of financial responsibility.

What if there are still errors on your credit report?

If you check your credit report and there are still errors, you have the right to dispute inaccuracies. Here’s the process of disputing them:

1. Get a free credit report. You can have one ready in minutes with a free report from Credit Boost!
2. Look for errors. These can manifest as past paid-off judgments that remain, erroneous defaults, personal information errors (your name, address, etc.), incorrect payment history, and more.
3. Gather evidence against the information to support your argument. Then submit your complaint along with proof to the credit bureaus. Include the specific information you believe is incorrect and why.
4. The credit bureaus have 21 business days to investigate your dispute. They will contact the data furnisher (the company that provided the information) and ask them to verify it. After, you’ll be notified of the outcome of the investigation. If the credit bureau finds it in your favour, the error will be corrected on your report. If they find against you, you have the right to request a review of the decision.
5. If you’re unhappy with the result of the investigation, contact the credit Ombudsman. They’re a free and independent service that solves disputes between consumers and credit bureaus.

Remember to keep all communication between you, the creditor, and the Ombudsman in writing. And while your dispute is pending do not apply for credit, as this can knock points off your credit score.

Remember, it’s important to take care of your credit. It dictates your financial and lending freedom. If you need assistance with credit clearance, be sure to contact Cape Town Legal Consultants. We can help you with ITC clearance and getting your credit back on track.