INTEREST RATES & CREDIT SCORES

Justin Harrison 00:02
If you are joining us for the first time on one of our webinars, please leave us a message in the comment section; let us know where you're from. If you're one of our regulars, I'm sure we will recognise you. But please say hello in the comment section, just so we know you guys are there. And we’re in a slightly different format this evening. Our webinar will run a little bit shorter than usual; we're looking at about 35-minutes, hey Dawie?

David Bester 00:30
Yes, I think 30-minutes should be enough, depending on the questions that we get afterwards.

Justin Harrison 00:37
Ja, perfect.

David Bester 00:40
Okay, good evening, David, Zamo, Jabu; please let us know where you guys are from.

Justin Harrison 00:52
Ja, let’s give it a few more minutes, Dawie. We'll get everybody on the stream. The notifications have just started going out, delivering via WhatsApp and Facebook. So, guys, please bear with us while we give everyone a chance to get onto the live stream. David is in Cape Town this evening; I’m in Durban KwaZulu Natal. So, thanks to technology, we can all meet up and we're at a slightly different time than usual. Normally, we run in the mornings but we found, with everybody being back at work, that it just makes sense to run this, in the evenings to give people the best opportunity to access our content. And just so you guys know that, if you do for any reason get cut off during the live stream. Please come back to our YouTube channel, we will post the replay on the channel. You can also access the replays and also some really great podcast content on mycreditstatus.co.za. In fact, if you go to mycreditstatus.co.za, right at the bottom of the page, you'll see a link to all our past webinars. You'll also see a link to all our podcasts that is run by one of our partners, Laura. Laura has been interviewing some really, really great people from around the country, involved in the loan industry, vehicle finance, and really just giving some really, really valuable information. Jabu, I see you say you're in Israel - that's interesting. Beaufort West, also very interesting; that’s your part of the world, nearly Dawie. There are people from Centurion, a lot of people from Cape Town. Jabu – another Jabu – here, from Pinetown; that's just near me, probably about 14kms from where I'm at the moment, so Jabu, welcome. Ja, Dawie, without further ado, let's hop into tonight note.

David Bester 02:56
Ja, let’s get started. So, today's webinar is about: “Interest Rates and Credit Scores”. As you guys know, we are currently sitting with a record-low interest rate. So, if you want to apply for any kind of finance, be it a house or vehicle finance now is definitely the time. And that's the purpose of this webinar: to teach you exactly how the interest rates work, and exactly how you can make use of getting a better credit score, in order to get a better interest rate, and lowering your monthly repayments. So, today what you will learn in this webinar is the Difference Between the Repo and the Prime Interest Rate. A lot of people don't know the difference, so we are going to explain it to you really quickly, without going into too much technical detail. Then, we're going to show you the Maximum Interest Rate for Lending Products. If you qualify for a certain product, and you have a bad credit score, then it means, that you're going to be paying a higher interest rate, and we will show you what the maximum will be. This will also give you an idea, an indication, of your credit score and if you can get a much better interest rate. Then, I'm going to show you How to Save Over R200,000 on Your Home Loan; we’re going to show you How to Save Over R7,000 on Vehicle Finance, and we're going to show you How to Save Over R3,000 on Personal Loans - not that we really recommend applying for personal loans but anyway, I'm going to show you, how you can make use of getting a better credit score, in order to save on your personal loan repayments.

‘The Repo Rate and the Prime Interest Rate’. What is the repo? The repo rate is the lending rate from the reserve bank - the Federal Reserve Bank of South Africa - to commercial banks. Now, the commercial banks, are banks like ABSA, Nedbank, Capitec, and all those banks. So, the reserve bank lends money to these commercial banks, and these commercial banks then have to pay it back with an interest. Now, currently in South Africa – I’m trying to get this info to load; it’s not loading - the repo rate is sitting at 3.5%. Now, the prime interest rate is the interest rate that the banks will be lending to consumers, like you and me. Now, the current interest rate in South Africa is 7%. Even though the prime interest rate is 7%, it doesn't mean that if you’re going to apply for finance, that you're going to be getting a 7% interest rate. You’ll most probably hear terms like prime interest rate plus one or prime interest plus three, or prime interest minus one, then you're really lucky, by the way. The interest rate varies on the different financial products. For instance, you'll be paying a lower interest rate on a home loan, than you would pay on, for instance, a credit card or a personal loan because obviously, a personal loan and a credit card, is much more risk than a home loan. If you default on your home loan, your bank still has your house, which they can repossess and get their money back. So, that's the reason why it's different from every single product. And, the interest rate, obviously varies on your credit score. So, if you've got a better, good credit score, then it also means, that you will be getting a different interest rate, from a person with a bad credit score, or an average credit score. And that's why we always say, that it's so important to fix your credit score first before you go apply for a product or for any kind of financial product, like a home loan or personal loan because you want the lowest repayment, and you want the best interest rate. In order to get that is, to obviously fix your credit score first. So, before jumping in and going and applying for products, because that's basically what we see on a daily basis is people, asking us, “Listen, I want to apply for a personal loan; I want to apply for a home loan”, but they don't actually think about the repercussions of the interest rate. So, if they've got a bad credit score, it means that they're going to get a bad interest rate, which means that they're going to be spending a lot more money in the long term. Justin, do you want to add anything there?

Justin Harrison 07:14
Ja, I think the important thing for people to realise is that the ideal credit score is the highest you can get because we have a lot of people always asking us, what is the ideal credit score to do X or Y. And also, the other thing that we find is, that often people tend to look at their credit scores after application. So, people go and do an application, and only then realise that there's a problem when they come back and they say either they’ve been declined or, you know, often the banks or the lenders, will very directly say, “Look, we could have given you a better deal if you had a better credit score”. So, the big tip to give everyone, before you go and apply for any kind of finance, make sure you pull your own report, make sure you have a look at your report, have a look at your score. And if there are problems with your score, if your score is less than anything that's really good, then, what I would suggest is, follow the tips and advice on mycreditstatus.co.za. There are loads of content; all the members have access to a full video library, where they can go and access content on how to improve their score and Dawie, on the YouTube channel, we've given out loads and loads of content, on how to improve your score. So, really, the big tip is, just go and make sure you take a report on yourself first. Also, the great thing about taking a report on yourself first, it doesn't count towards the number of inquiries on your profile. So, what would happen is, if you go to a lender and you pull your report, that will go on your credit profile and generally speaking, it will have an impact on your credit score. So, it's really, really good to go and do the inquiries yourself. It's a soft inquiry, which means it doesn't actually add to your record, and then you can see if there are any problems that you need to fix. And David going to get into this shortly but just moving your credit score to different levels, can save you an enormous amount of money.

David Bester 09:13
Yes, lots of people actually don't know this but we've touched on it so many times that, according to news sources, about 80% of people have errors on their credit scores, and one out of five people, have errors on their credit score that is damaging to their credit score. Now, if you can find these errors on your credit report and you can simply get it disputed, and remove the error from your credit report, immediately, your credit score will increase. That's, basically, the easiest way that you can increase your credit score because it's pretty obvious; if it's an error, it shouldn’t be on your credit report, and they are pretty easy to get it removed.

Justin Harrison 09:51
Dawie, I actually had a friend, who signed up for a system the other day and he was asking me, why should he check his credit report on a regular basis and exactly what you've just said, I actually worked in a slightly different way. When I was chatting to him on the phone I said, there's only a 20% chance that your credit record and credit profile and score is actually correct. A 20% chance that your data, sitting out there, is correct. So, for me, there's no bigger motivation than that, to go and basically check your records, make sure it's accurate because it's as simple as, often a clerical error, that could cost you an absolute fortune in high-interest rates.

David Bester 10:35
Ja, I mean, some errors are damaging to credit scores; some aren't. For instance, when it’s an address, it's not really that damaging. But, yes, that just shows you, it's about an 80% chance that there are. I mean, I had the same thing, I just had disputed it and it was pretty easy. I got it removed without any hassle.

So, let's get into the ‘Maximum Interest Rate Per Product’ in South Africa. Now, according to regulations, this is the maximum that financial leaders can charge you. If they are charging you more than this, then, yes, you can probably go legal because according to regulations, according to law, it's not allowed. Okay, so a personal loan, that's why we always say, we don't recommend applying for personal loans because the maximum amount is 27.75%. This is astronomical. Think about it. Warren Buffett and those people are considered one of the best investors in the world, and they’re basically averaging a 23% interest rate.

Justin Harrison 11:41
Yes, I was just about to say, if anybody wants to take a loan from me, at 27.75%, I've got good money to loan. So, you know, hit me up in the comment section and I'll loan you money at 27.75%. I'm happy to do business on that basis. I mean, that is just insane! I cannot believe that somebody would take a loan, be that desperate to pay that kind of interest. I actually, need to go throw up a little, right now; I'm actually feeling sick on my stomach, that somebody would pay that. That is insane!

David Bester 12:16
I will give you a reason to throw up, because, not only do you get charged the interest rate of 27.75%; you're going to get charged the initiation fee, and you're going to get charged an admin fee, so, that kind of brings your interest rate – oh, and credit life, by the way – so then, you're probably looking at closer to about 30%+ interest rate on your personal loan. The problem is that most people don’t know that.

Justin Harrison 12:37
I feel sick; I don't know how anybody can pay interest like this. Guys, please, go get your credit report, go pull your credit profile, please, please, please start taking some responsibility. And please, get out of debt, like 27%, I mean, come on.

David Bester 12:55
Yes, drop a comment here in the box. What do you think about 27.75% interest rates? Now, you probably won't ever see this, coming from any credit bureau or credit bureau reseller in South Africa because they want to sell you the personal loans because that's actually how they make money, in order to give you a free credit report. So, that’s what makes us a bit different in the industry. We give you honest advice when it comes to interest rates and financial products and what you should apply for and what will absolutely hurt you when you apply for these kinds of products. So, onto the next one. Home loan: 18.75%

Justin Harrison 13:36
Holy crap! Who takes a home loan at 18%?

David Bester 13:42
Ja, look, if you guys really want to, I can probably give you some numbers to work on, a little bit later, by playing around with some calculators and show you what you actually end up paying. If I were you before you take on or before you sign the contract for any kind of financial product that you apply for, go to a calculator - I'll show you guys on My Credit Status, we've got a bunch of calculators; we've got a bond calculator, a vehicle finance calculator and a personal loan calculator - go play around with the interest rates. Go play around with a calculator and see what your repayments will be. A credit facility – now, this is like a credit card – is also astronomical: it's 20.75%. And then, lastly, vehicle finance; also, very high, at 17%.

So, ‘Prime Interest Rate Facts’. The interest rate depends on your credit score. Now, even though we showed you… Okay, a personal loan is a bad example because you can have a great credit score, but I bet you, personal loan companies won't give you much better than an 18 or 17% credit score. For instance, when it comes to a home loan, you might get something like seven minus one. I have heard of people actually getting that. I know a relative of mine is actually still locked into a prime interest rate with minus two points. So, that means, that this relative is actually paying, not 7% but about 5% on the home loan. Now, that's basically money for free. Stuff like that can only happen if you have a good credit score. If you have a bad credit score, you're going to be paying closer to the maximum interest rate, which is what I just showed you. So, just by fixing your credit score, you can get a huge, huge discount, not only on your monthly repayments but the total interest payments, that you're going to end up paying. The higher your credit score, the lower the interest rates, and that is exactly what I explained just now. What you want to do, on our system, we work on credit score, out of 705, so that means, the closer you can get to 705, the lower your interest rate is going to be. Don’t strive for an average, or just a good credit score; what you want to do is, you want to get the best, best possible credit score. If you want to lower the monthly repayment, you'll have to increase your credit score. Let's take some examples and this is what you guys want to see, right? I took very conservative numbers here, not even close to the maximums that can be asked by these financial institutions. Let's take a home loan, for example, you've got Person A, and you've got Person B. The one's got a good credit score; the other one has an average credit score. Notice that I didn't even put the excellent credit score in here but let's just take this, as an example. If you can just get a better credit score, of two points, you end up saving, on this home loan, R262,800. That is a massive saving, and that's because of the interest that you're paying because your monthly repayments are going to be lower if you've got a lower interest rate. That means, that you’re going to be paying, less in interest than Person B with just the average credit score. Now, most people will be happy, if they can just get an average credit score and be able to apply for a home loan, or just be approved for a home loan. But look at the amount of money that you can actually save, just by increasing your credit score, slightly. It's R262,800 over the long run. Now, here's another example and this is for vehicle finance. So, you've seen that the interest rate is slightly different. I took an example of R100,000; the person with a good credit score at 10%, and the average credit score at 12%. Sorry, this is supposed to be 72 months on both. But what you’ll be paying is the interest rate is R7,375 more, if you've got an average credit score, than the person with a good credit score, Now, notice that this is good and average; this is not even bad credit scores. If you take a person with a bad credit score, you're probably looking at doubling or tripling this amount. A personal loan example: so, a person with a credit score of 20% versus a credit score of 24.5%, which is the industry standard, by the way. You will see that most places - when you go apply for a personal loan - even though they're allowed to charge more, the industry standard at the moment, is sitting at about 24.5%. And if you pay this R25,000 loan off in two years, then, if you just have a little bit better credit score than the average person, then it means that you're going to be saving R3,229.48.

Okay, so, obviously you guys want to know, ‘What You Can Get with My Credit Status Membership’ and how you can use it, in order to increase your score. Like I showed you now, by the examples that you've seen now, you want to get a better credit score because you could be saving a lot of money in the long run, when you get your better credit score. We've been getting a lot of questions from people asking us, what is included in this membership, and why we actually recommend the membership over any other products, or just getting a once-off credit report. So, here goes. You get a monthly credit report every single month - this allows you to see when you can get a better credit score or when your credit score has actually increased. It's all good and well, you dispute some payments or dispute some accounts, but if you don't actually check it and check that the error is gone, then how would you know if it's actually updated or not? So, you need to check your credit report monthly; you need to check if the changes that you have made, is actually improving your credit score, or if it's actually damaging your credit score. And then, obviously, for identity theft as well. We did a video last week on identity theft, and we discussed how identity theft has increased by 33%, just in the last year. So, if you check your credit score monthly, that means that you'll pick up immediately if someone is trying to steal your identity. Anything you want to add there, Justin?

Justin Harrison 20:31
No. I think it's very relevant, what you're saying and I think, the most important thing about getting your report and we've discussed this many times. It's all very well you go and get a report once off but if you're not continually monitoring your reports; if you're not continually trying to improve your score; if you're not continually making sure, who's doing inquiries on your name; then the chances are, you're probably going to end up with a bad score, down the line. If not through the fault of your own, it may be through the fault of someone else. I cannot recommend it highly enough for anybody. You should absolutely go and get a monthly membership and take the report. I mean, the amount of money we’re charging every month, people spend more than that on a box of cigarettes or two. And the kind of money you can save long term is just absolutely crazy. One of the things you didn't touch on, Dawie, because, I think, you probably don't have time in the notes but smaller little things, like insurance policies, people don't realise when you go to get an insurance quote, and they do a risk assessment on you, your credit profile basically adjusts your risk profile. And so, the way insurers look at it is, if you’ve got a poor credit profile, the chances are higher that you're going to claim. And there's a lot of studies and data behind it but essentially, you land up paying more on your insurance premium. I think people don’t really, fully appreciate the true cost of having a bad credit score. You know, Dawie, up until about, maybe five, six years ago, this industry that we're in, was very much an institutional business. So, you had businesses talking to businesses, about your profile, but you never really had a chance to look at your profile; you never really had a chance to engage with your profile and see what the problems are, to fix it. You were pretty much at the mercy of institutions and now with mycreditstatus.co.za, consumers have the chance to go in and get their profiles; they have a chance to go and fix mistakes before they apply. And, and the spinoff of that is just, you're going to be saving a crapload of money, down the line, if you get your score right.

David Bester 22:43
Ja, exactly, even with something as simple as a rental contract. If you want to rent a property, most estate agents, these days, do a credit check first, before they will approve you. Okay, we've also got an automatic dispute generator. I have explained to you already, what happens when you've got an error on your report and the statistics show that about 80% have errors on their report, and one out of five people, have errors that are damaging to their credit score. The way you can fix this is, to dispute it. Now, on My Credit Status, it's as simple as clicking a button. It generates a dispute template for you; you can also upload your documents, your proof - if you've got any proof to show - let's say, for instance, if you’ve got incorrect accounts - you can just upload it to the system; it will generate a PDF, that you can just send out to the credit bureaus. You don't have to physically go and do this anymore. You don't need to know the ordinary legal jargon even; we do everything for you when you apply for the membership. You simply have to send it to the credit bureaus and track the process.

Then, we’ve also got tools and education to increase your credit score. We've got a book called, ‘Insider Secrets to Increasing Your Credit Score’. It's packed with loads of legal templates, that you can simply copy and paste; you can simply just fill in the blanks, and you can use it to your own benefit. We've also got a video course called, ‘20 Ways to Increase Your Credit Score’. And then, we've got some other downloadable tools, like budget spreadsheets, and we've actually got an online budgeting tool as well, that you can use. Then, you’ve got access to our exclusive Facebook group, as well. Now, on this Facebook group, you can get direct access to Justin and me. We actually handle this with this group, ourselves; we reply to every single comment on there. We've actually got quite a few people, already making use of it, and some members have already given us, very good testimonials of how they've increased their credit score, dramatically, just in a few months. Then, last but not least, you also get access to 24/7 telephonic financial assistance. Now, with this telephonic financial assistance advice, you can ask anything finance-related, even if it's about interest rates, how to get a better interest rate, what is a bad interest rate for certain products. If you want banking advice, if you want tax advice, this membership alone will already pay for your membership on My Credit Status. So, it's definitely very helpful to have. And then, that's about it. Justin, do you have anything to add there?

Justin Harrison 25:27
No, Dawie, I think the info that you've covered is really relevant. I think we'll just quickly address a couple of questions here, for a couple of minutes, since we've got a little bit of time to address everything. I just want to stress the importance of getting a monthly report. I don't think consumers really understand, how the financial landscape has changed. You, pretty much, cannot go and take up a lease, without being credit checked; you, pretty much, cannot get an insurance quote, without being credit vetted. I mean, certain industries that you choose to go to work in, especially if it is finance related or you're dealing with money, very often, you'll be credit checked, as part of your job intake. So, I just want to say to people, you really have to start treating your credit profile very seriously. And, credit identity theft is on the rise; we've known that it's been a problem worldwide, for years. But guys are getting really, really clever in South Africa. I saw a story on Carte Blanche, on Sunday, where they had a bunch of scammers online, basically, cloning people's identities and going and opening up accounts all over the show. And so, people need to really appreciate that, your credit profile is something that you need to manage; your credit profile is something that you need to check on. It's no different than a bank balance. You wouldn't leave your bank account unattended for months, at a time; don't leave your credit profile and your credit record unattended. So, that's really the point, I want to get across, and, I'd like to say to everyone if you haven't already joined onto mycreditstatus.co.za, go and join. It's a monthly subscription; you can cancel at any time. There are no lock-ins, there are no contracts. We charge less than what it would cost you to go buy two boxes of cigarettes. In fact, I don't even know what a box of cigarettes costs anymore but it's cheap.

David Bester 27:24
It is actually more than the membership.

Justin Harrison 27:28
Well, there you go. My advice is, go and get yourself a membership; start managing your credit profile and then the other thing is, once you're a member, join the Facebook group because David and I sit on there and we answer the questions, along with our business partners, along with our support staff. We are really committed to helping South Africans improve their credit profiles. And, as you said, David, unlike a lot of other credit bureaus in the country and a lot of other institutions in the country, we're not trying to push people onto loans; we're not trying to push people onto debt. We are absolute, of the opinion, that people should try and get to a point where they debt-free. We don't want people to be in the debt trap. And so, the reason for checking your credit profile - we don't want to encourage you to do that, so you can go and take up more loans - we want to encourage you, so you can pay less on the loans, that you have. We want to encourage you that, for finances, you need to access it. You can get the best possible deals. And, really, if you guys are stuck with anything, Dawie and I are there, on the Facebook group, if you're a paid member. And we can help you 24/7. David and I are always attached to our phones; we’re always answering questions. We are passionate about financial education, so, you're not just getting a credit score with us; you're getting really a holistic financial approach. And if you become a member, you'll soon see, there's a huge library of content. We're continually adding to the content - there are webinars, there are podcasts, these books; it's worth the money 100 times over. So, go and get a membership. Dawie, I just want to bring up a couple of quick questions here, for you and if you can maybe just quickly tackle these off, one-by-one, as quickly as possible, in as short an answer, as possible. We’ve quite a few to get through.

David Bester 29:13
Perfect. Just something I want to show them, really quick, before we get to the questions. This is the My Credit Status site. I promised you guys, I'm going to show you the calculator, so you guys can do the calculations for yourself. If you click on this burger icon, this is, obviously, the menu. You go to Articles and then, you will find all the information, all the calculators, the podcast, the webinars, everything that you need to get a great credit score. All the information is here as well. You will see the calculators are here; we've got a bond calculator, vehicle finance, personal loan, even retirement and life insurance and credit card, calculator. Then, we've got a whole lot of videos and articles on credit scores, podcasts, with expert industry leaders. And, obviously, the webinars where you guys are currently watching us. So, if you want to catch up on some of the previous webinars, this is where you will see it.

Justin Harrison 30:09
Perfect. Okay, David, the first question is: “What is the best credit score for buying a house?”

David Bester 30:14
For buying a house, you're looking at about 650+, but you need to remember that also depends on, firstly, your relationship with your bank, your history with your bank. So, listen, there's a few things to keep involved but generally, to qualify, just to qualify - sorry, that's not the best credit score - but to qualify for a house or a home loan, you need a minimum of about 650. Obviously, you also want to get as close as possible to 705.

Justin Harrison 30:44
So David, if somebody comes to you with a credit score, let's say of 520, are they going to get approved – yes or no?

David Bester 30:48
No. Not for a bond.

Justin Harrison 30:50
Okay. If somebody comes with a score of 600, are they going to get approved – yes or no?

David Bester 30:52
Not very likely.

Justin Harrison 30:55
Okay. So basically, the minimum score to get approved, is…?

David Bester 31:01
650.

Justin Harrison 31:02
650. There you have it. Perfect. Okay. Next question: “How can I fix the errors on my data, on her profile?” Very, very quickly.

David Bester 31:14
Okay, so, if you've got errors, you need to dispute them with the credit bureaus. We did a webinar on disputing items with the credit bureaus; you can go back, reference back to that and see, or you can use My Credit Status. If you sign up as a member, and simply click a button, underneath the wrong account and get a legal template, delivered right to you.

Justin Harrison 31:34
Ja, so David, there are two ways. There's a manual way, which really sucks. I've done it; you've done it. And then, what we've done on mycreditstatus.co.za is we’ve made it really easy: click one button, select the item you want to dispute, follow the process that's presented to you online, bada-boom bada bang, dispute generated, right. It’s really easy.

“Will the incorrect address rectification increase my credit score?”

David Bester 32:00
No. not likely. The address doesn't really count that much towards your credit score.

Justin Harrison 32:06
What I also suggest is, go back and check the previous webinar that we did on the things that affect your score most. David gave some really great tips on the most important things, to the least important things, and literally, it's a step-by-step guide. Nobody else has shared this information. Go check it out on the YouTube channel or go to mycreditstatus.co.za, go to the webinars section and go reference that webinar there. There's some really good content on it.

“How important is it to compare interest rates?”

David Bester 32:40
Extremely, extremely important.

Justin Harrison 32:44
Ja, David, I don’t think people realise, that 1%, over 20 years, for a home loan, is just astronomical money, right?

David Bester 32:53
No, it’s insane. We can sit here and show people examples of calculators and how much you’re going to be spending, all night. I mean, that's what we love, but simply, we've don’t have enough time to do that tonight.

Justin Harrison 33:03
And I think what people don’t realise, David, is on a 20-year term, you don't really see the money because you’re just paying a little bit every month but when you actually look at what you paid over a lifetime, it's considerable right?

David Bester 33:18
No, it's a massive amount.

Justin Harrison 33:21
Okay. I’m just going to bring on, one or two last questions. David is saying, “I have debts to pay but now I'm not working anymore, so how can I improve my credit score on lower payments?”

David Bester 33:37
“…but I'm not working anymore”. That means, that you don't have the money to repay your debt. I think that's what you mean. So, if you don't have money or if you’re in a tight spot at the moment, I would highly suggest you phone up your creditors and negotiate a lowered interest repayment. That's actually what debt counsellors do if you go under debt review. What they do is, they go to the creditors, they work out a budget with you, they do an entire financial plan with you, they see what you can afford to pay and then they go to the creditors and tell them, “Listen here, here's the guy's budget, he can only afford to pay X amount. You need to lower the repayments or he’s going to be defaulting on his debt.” And then, most probably, the creditor is going to lower the interest rate, and then, what they also do, to lower the repayment term, or they increase the repayment term, let's for instance, say you've got two years left on vehicle finance, then what they do is, they extend it for another year because that obviously lowers your payment. But it means, you're going to pay more in interest, so you need to get your interest rate also…

Justin Harrison 34:40
So, the short answer is? Go find yourself a debt counsellor and really sit down with somebody who can professionally negotiate on your behalf. And, it’s obviously a really crappy situation that you're in, but hopefully, that won't last forever and then eventually, you'll be back to some kind of earning, where you can repay your debts. The last two questions, David, two are actually really good.

Sifiso says, “Guys, what advice would you give me, I have a 9.1% interest on my bond. Credit score was 646 when I took it. Do you think it's best I move my bond to another bank? The bond is currently for 485,000”.

David Bester 35:18
Okay, so, your credit score’s okay; you’re in the average bracket, but you're not great. So, you don't have much leveraging power or much negotiation power. So, what I would do, if I were in your situation, would go and increase my credit score, immediately. After about three months, if I get a good credit score, my credit score is now up to standard or great or, excellent, I would go back to the bank and say, “Listen, I want to refinance my home loan because I've got a good credit score. And if you don’t refinance it for me, I’m going to go to another bank”. And I would, actually, just compare all banks’ interest rates. You can go to a bond originator who can do it for you, but I will definitely first increase my credit score, and then, go to the banks and renegotiate the home loan or refinance the deal.

Justin Harrison 36:00
For sure. And then, the last question that we got time for: “We just made the last payment for a debt that was flagged under debt review. What is the best way to boost our credit score, as we want to switch our bond? We’re currently paying {ouch!} 13.2% for a home loan.”

David Bester 36:19
That’s astronomical. So, I’m going to be quite honest with you. If you're just coming out of debt review, it's going to take a while for your credit score to increase. I think if you want to get a good credit score, you're probably looking at a minimum of a year before you can apply. So, you're currently stuck on that 13.2%. The problem is, if you get out of debt review, you’re basically starting off clean, so you have to build up a history, you have to build up a good profile again. So, it's going to take time, but the sooner you start, the sooner you're going to get there.

Justin Harrison 36:50
Yes, and my advice would be - Number one: make sure you keep up with your payment history; make sure your payment history is up to date, that's the first thing. The second thing is: make sure there are no incorrect listings. The third thing is: really just to get within your debt utilisation ratios. Go back and check our previous webinar on how to improve your credit score. Get those things right and once your score starts moving up, that is the time, you start going to negotiate. Remember, you have absolutely no negotiating power unless you have improved your score. So, that would be our suggestions and our comments. Guys, I really hope that you're finding some value in this. I really hope that you've learned something this evening. The big take home, we want to put across to people is, make sure you check your credit profiles; make sure you manage your credit profile; make sure that you fix things, now, before it's too late. The problem is with most people, they only look at their credit reports and their credit profiles when they're actually applying for loans, and that's a big mistake. You need to start doing the work, a couple of months before you intend to apply for a loan or any kind of financing. I highly encourage you guys to go to mycreditstatus.co.za, register, sign up, take the membership, there's absolutely no ongoing obligation. It's a couple of bucks every month; it's less than R100 a month to go and get your profile and access all the educational content on the platform. It is absolutely a no-brainer because your credit score is going to save you thousands upon thousands upon thousands, every single year if you get it right. So, guys, that's it from my side. I hope the content was useful. Please join us again. Dawie, we’re going to do a Q&A section next week, I gather, My Credit Status? We'll do a Facebook live Q&A session; Dawie will post out the notifications on that. You'll be able to join the live feed as usual; ask your questions, and if there are any specific issues that you're battling with, before then and you can't wait until then, please become a member; go to the Facebook group; join the Facebook group and start chatting there. We are very, very active in that group. As you guys can see, it's 06:30 at night and Dawie and I are still working hard; we’ve probably still got another few hours ahead of us. So, we are very, very committed to helping everybody in South Africa, improve their credit scores, improve their credit profiles, and most importantly, become financially responsible. So, from my side guys, thank you very much. David, thanks so much for the content this evening, and we'll catch up with you guys, next week, on the live Q&A.

David Bester 39:29
Ja, thank you, everyone. While you're on here, please remember to click the [subscribe] button. This will allow you to get notifications whenever we send out new content or whenever we do these live Q&A sessions and these webinars. We're going to be doing away with the WhatsApp groups, pretty soon. So, the sooner you start subscribing to the channel, the sooner you'll be getting the notifications as well. That's it from our side; we’ll see you guys next week on the Q&A and then, the week after on another webinar. Have a good evening.

Justin Harrison 40:02
Ciao.