
Certain types of loans don’t affect credit score in South Africa.
These include the loans against vehicles and other assets of value offered by LoanAgainst.
Why it’s useful to maintain a good credit score
A good credit score represents how you or your business manage credit. It is the key to easier loan approvals, lower interest rates and more favourable terms.
Credit score and payment history impact every facet of the financial landscape, from the ability to rent property to paying more or less for short-term insurance.
A good financial track record makes servicing debt cheaper. Banks and other unsecured lenders rely heavily on credit score to determine risk.
When the numbers are high, access to credit is quicker and more affordable. This applies equally to individuals and businesses in South Africa.
A poor credit score has the opposite effect. That is when secured asset-based loans can prove invaluable.
What happens when you take a bank loan
Traditional lenders like banks communicate directly with South African credit bureaus before approving loans and while you’re repaying them.
If you don’t have a credit score of at least 610, you’ll find it difficult, if not impossible, to get a personal bank loan in South Africa. The ideal range is between 670 and 739, at which point you’ll be able to negotiate better terms.
It is worth bearing in mind that loans with these institutions can negatively impact your score. Every credit enquiry made through traditional lending channels reflects on your credit report.
In the eyes of banks, short-term insurers and even prospective employers, multiple credit applications are indicative of risk, especially when submitted over a short period of time.
The fact that you have acquired additional debt can shave points off your score, making it more difficult in the future to apply for a loan or credit card, or even open a retail account.
How to find out your credit score
Free credit reports and credit scores are available online at:
Why opt for loans that don’t affect your credit score?
These types of loans are secured by an asset, so the risk to the lender is low.
There’s no need to conduct credit checks or report loan transactions to credit bureaus. This allows you to maintain a healthy credit score if you already have one.
When collateral rather than credit score is the sole metric for loan approval, it’s easy to access finance. This applies to any individual or business, notwithstanding a weak credit rating.
Why LoanAgainst doesn’t communicate with credit bureaus
LoanAgainst doesn’t communicate with any third party unless legally obliged to do so.
We don’t need to use credit scores because our loans are secured by the assets our clients offer as collateral.
Get a loan in South Africa from LoanAgainst
We’re a trusted lender with branches in Cape Town, Durban, Johannesburg and Gqeberha (Port Elizabeth). We offer loans that don’t affect credit scores in South Africa.
Our loans are fast, transparent and discreet. They have competitive interest rates and no hidden fees or early settlement penalties.
If you want to get a loan in South Africa and you own an item of value to use as collateral, contact us or simply apply online for a loan.