Do not rush into signing a credit agreement. Take time to read an agreement, and understand your rights and obligations before you sign a contract that will bind you to its terms and conditions, Manie van Schalkwyk, the Credit Ombud, says.
“When reading your credit agreement, make sure that the description of the goods and all the costs you are liable for are clearly stipulated.
“You need to understand the implications of the interest and monthly costs, which include administration fees, as well as any additional insurance fees. The interest, insurance and monthly service fees often add up to double the original amount of the goods,” Van Schalkwyk says.
You should avoid entering into credit agreements if you are employed on a contract basis.
“If you are on a contract and it ends, there is a big risk that you will not be able to keep up with the instalments. This failure to pay will affect your credit record and could result in the matter being handed over for collection. In addition to the debt you owe, the costs that arise from legal and collection fees could run into thousands of rands,” he says.
Since January this year, the Credit Ombud has saved consumers a total of R1.38 million and resolved 1 953 disputes with credit providers.
If you have a complaint related to a creditor, a credit bureau or debt counselling, you can contact the Credit Ombud’s office on 0861 66 28 37 or visit www.creditombud.org.za