 I need to rely on good evening and welcome to episode 170 of the private property podcast. I'm your host, Uzaman Domo Komalo. It's the Monday edition of the private property podcast. I do hope that you've had a great weekend, that you were keeping safe as much as possible during this festive season. I know that so many of us probably want to be out and about, but as we're seeing the COVID numbers increasingly going up, we need to exercise a bit more caution. And I know that also later on this evening we're going to be having an address from the president, so do watch out for that one. Something else that you should definitely, not just watch out for, but certainly get excited about that. We're bringing you here on private property is our December competition. I've been promising this one for quite a number of days now, and I've been saying that we're cooking something up, and we want to make it extra special so we can end off what has surely been probably the most intense year NOFIs has ever gone through. Now to celebrate, certainly celebrate and also award you as our community. We're running a competition where you stand a chance of walking away with 100,000 in total. So they're going to be different awards, different prizes across different competition. So in total we're going to be giving away a whopping 100,000 rounds during this festive season. And one of the ways that you can win, certainly on the private property podcast, is by watching the show. Now you're probably wondering how, because you already watch the show all the time. Well all you have to do is make sure that you recruit four other team members to come together as a team, because we've brought together a competition called Questions for the Champions. Now Questions for the Champions is an exciting competition that we've been cooking up with the team. And all you have to do is tentatively rather watch the private property podcast, make sure that you and your four team members are watching, give yourselves a name. I mean I know that the current reigning champions are Orlando Parrots. So choose an interesting name that you can use and make sure that when you're watching the team clocks in with the hashtag of the team to indicate that they are of course watching live. And what we're going to be doing that is at the end of every episode, we're going to be asking questions that are based on the previous day's episode. So we're going to be asking yesterday's questions. So tomorrow I'll be asking questions based on today's episode. And of course you and your team can answer and you have about a minute to answer those particular questions. And the team that gets it right first will be walking away with over 1,500 grand. Now we're only going to be announcing the winners the day after the actual you know day. So for tomorrow we'll be announcing the winners on Wednesday. And this is to make sure that we verify that all the team members were in fact live on the live itself, that they did make themselves known and they also answered first correctly. Now in the event where you know there is a split where you know another team also gets it right in the same amount of time. Well don't worry we've also got that one covered. And we're also cooking up a grand finale for later on in the month that we're quite excited about. So you can see that there are quite a lot of things that we are very excited about. And in that grand finale we're going to be asking 10 questions where you stand a chance of walking away with 15,000 rands. And the second runner up is going to walk away with 10,000 rands. Now I know that those are a lot of rules but one thing that you need to remember, recruit four of your friends and family, make sure that they hop on the live as you're watching the Private Property Podcast across the different devices that you'll be watching from and listen attentively because all the questions are going to be coming from the episode. You have to be watching live, you have to be answering and we'll make sure that we announce the winner the following day. It is that simple. So do make sure that you recruit those friends and family and tune into your Private Property Podcast, which is of course the premier podcast when it comes to all things relating to property. Well and I'm quite excited about this and we all know how we love giving away money and how excited I specifically get when we give away money here on the Private Property Podcast. Now something else that we've been that's going to be coming to your screens this week and I've been talking about it from last week is Building Stronger Homes brought to you by PPC. It's going to be coming up just after this podcast at and that is a great web series that we're going to be running throughout the course of this week that you can look forward to where we're looking at the different ways that we can build better stronger homes and it is in partnership with PPC. You can watch the interviews that I've had with the various guests at PPC about the different ways that and certainly the different ways we should be thinking about how we should be building our homes. That's a podcast certainly a web series that you do not want to miss out especially this festive season if you are looking at whether extending the home whether adding a room or two or even doing that Chrome renovation it is one of those resources that we all need especially during this time of year. Now I know that that's a lot and we certainly have an exciting topic to go through this evening with a guest who needs no introduction. I absolutely love speaking to her every time we have her on. This evening we're looking at the mistakes to avoid this December that could potentially jeopardize your credit score. We know that it's a festive season is a big day and a lot of us probably want to do the most but we also need to exercise on the side of caution to make sure that we don't mess up our credit score because 2021 is just a few days away and you probably want to make sure that you keep your credit score as clean certainly as high as possible if you've got whether it's home ownership ambitions of the new year or if you want to move because the reality is landlords now also look at your credit score and joining me this evening it is Michelle Dickens who is the manager of TP in the credit bureau. Michelle good evening and thank you so much for joining us. I'm always good to be with you thank you. It's always a pleasure having a chat with you Michelle I think one of the big things with you know this topic is we are of course in the festive season people probably make all kinds of mistakes I think one mistake that I know that a lot of people probably didn't make was getting to a lot of debt for the for Black Friday specials when we saw the retail numbers for Black Friday there were certainly no one year what 2019 was which you know on the one hand is not that great for retail but on the other hand I think it's quite great for consumers that we're able to you know just exercise some caution and not not go for deals that we think are great deals but actually are probably not but perhaps you know take us through some of the mistakes that we do tend to make during this festive season that could potentially actually mess up our credit score. So I remember my one tenancy it wasn't 2019 it was 2018 and my tenancy to you Mitch I'm so sorry I spent your rent on Black Friday I'm gonna have to come up to a payment arrangement with you and how do I how do I fix this and I can promise you in 2019 he did not do he did not do the same but I mean if you look at the Black Friday numbers transactions were down 30% from the previous year in terms of banks of Africa's reports value was down 52% from 2019 and when you look at how people spend the majority 78% of that was spent on credit card transactions rather than debit card transaction so absolutely speaking to the fact that people were prepared to spend on their credit card and the value just wasn't there on your debit card transaction interestingly though online sales were I think something like 18% so and even on Cyber Monday transactions were up 49% from from the previous year so there's a change in behavior and in terms of the online transactions but overall nowhere new where it was in 2019 in terms of if you look at payment behavior from a consumer behavior we are seeing a shift towards credit card transactions rather than payday loans again speaking to the fact that people are doing more online shopping and therefore need access to the credit facilities rather than a payday loan which they can spend a new payday loan can spend on rent deposits and other kinds of transactions so certainly credit card transactions on the increase and credit use of credit facilities on an increase and therefore being paid better so in the past payday loans paid better than credit card transactions but now in terms of the transhumane data you're seeing that credit card facilities are being paid better than your payday loans were in the past so there is definitely a change in behavior from that perspective I mean if I look at you know some of the things that I also bought sort of during that Black Friday even Cyber Monday all online and one of the big reasons was because of course we're you know in the middle of a pandemic I certainly don't see myself going into a mall to buy something and so you tend to find that online does become very convenient to be able to do all those kinds of transactions and you know I'm very interested to you know find out the you know the payment patterns when people are paying back their credit card if they don't default on their credit cards we're seeing an increase in you know credit card sales as you say I know one of the things that I did was actually paid down the credit card made it quite a small balance and I think my credit card limit is like 2000 and if I need more I'll just add more money and that's essentially purely for any online transactions that I need because I don't want to jeopardize my my check account because also when you think of the the level of fraud is is also just quite shocking so you almost want to safeguard you know the accounts where you know that there could be quite a significant amount of money and rather just use that small credit card facility where you can still do all kinds of you know different payments and purchases online so how are people kind of paying back those credit cards because it's one thing to to go online and sort of do the very responsible thing of being able to buy online especially right now because we're in the middle of a pandemic are we paying the credit card as quickly I mean I know a lot of them sometimes have like a 60 day interest free but are you paying it sort of sooner or kind of waiting it out doing a minimum payment and having it roll over and constantly being maxed out so I mean if you look at your credit scores there's a couple of different aspects to your credit scores that are taken into consideration and it's not just looking at your payment profile so your payment profile is how am I paying my account and there what the bureaus are looking at is identifying do you pay your account in the current month do you pay one month in a year two months in a year three months in a year what is the value that's outstanding on that credit card value in terms of your minimum balance and that will affect your credit score so if you miss a month your score shows a one one month in a year's your payment profile line if you miss two months your payment profile line will change to two so you're two months behind on that particular account really what you want to be in current is a zero if you if you then get yourself to earn two months behind on my accounts and you start to make the minimum payments but you're not catching up your years it means that your payment profile line for that account remains at a two so just that they're at a two balance in terms of what happened during COVID a lot of payment relief and payment holidays were provided and in terms of those payment reliefs and payment holidays what that means is everyone's payment profile lines where there was payment relief offered were set to a two so you were set as a two and you wouldn't get worse than a two in terms of how far you are behind so long as you maintain your minimum balance in terms of that relief that you negotiated with your credit provider and then coming out of your payment holiday you want to start bringing that you want to start bringing that back down but it's not just about what your payment profile line looks like in other words are you in current one month or two months behind or up to i mean we come all the way up to nine so you can be up to nine months behind in terms of your payment profile online on a particular account and let's talk about credit cards as one of those is not just how many months you are behind we also look at credit utilization because i mean if you are offered two thousand rand credit utilization are you maxing that two thousand out and paying it down versus having got a ten thousand rand utilization or facility but you only spend two or three thousand of it that is perceived to be better because you're not maxing your card out and you are spending within 30 percent of what your facility allows and then you paying those minimum repayments back so it's about looking at the overall utilization of your agreements obviously something like a home loan is different or your car repayment is different because you don't have a facility on that say you have a million rand home loan you're paying it back ten thousand rand a month yes i'm calculating that at a 10 percent and i know we're at ten percent at the moment but say you paying back ten thousand rand a month then that doesn't form part of your utilization utilization is based on your credit cards that you have or your facilities that you have access to and you know michel actually wants us to move a little bit to store accounts and some of the mistakes that we should be avoiding because the reality is a lot of South Africans do have store accounts and you know use them for a whole variety of different reasons and sometimes and i mean there's quite a lot of you know drugs and social media right now about how the you know the salary that you're going to be getting this week must essentially last year until uh you know january 20th or 25th depending when you're getting paid and we all know how they stretch from you know the end of this week to january 20th or 25th depending when you get paid is quite a long one i mean it feels like it's three months old wrapped up in one and it's probably because you've got christmas you've got new years eve and all kinds of things usually in january also have back to school um and hoping that more than anything people are going to you know try and cut costs as much as possible when it comes to some of the festivities but the reality is that your other debts are going to be waiting i know some of the service providers have already sent through sms saying that you know a debit order that would have typically gone off say on the 20th or 25th might come off earlier so make sure that you have funds in your bank account you know what are some of the mistakes that we're making that jibidaz is our credit score when it comes to straw accounts so summer um it's about having a budget and understanding what your budget is and spending to that to that budget and absolutely in the month of december it is a special month because we have extra ordinary expenses for our summer holiday as a starting point it is festive we are going out more even under covered conditions um at the moment and we are going to spend more in the month of december um take home pays are down and if you look at banks of africa at the moment um october to october still 10 less people earning um income receiving a salary into their bank accounts it's not as bad as the 34 percent year on year that it was done in the month of july but still 10 down year on year in the month of october so there are less people earning a salary it's good to see that the salary amounts are going up so i think that five percent from the month of september to the month of october so that is really good news um as well into december and are people earning the december bonuses that they earned in the past are they earning a bonus at all and is it as much as they were earning in the past not to mention the fact that they are still less people employed that they were previously into january as you say and there's extra ordinary expenses like the back to school expenses some of we profile school payment profile at the moment and december is typically the best collection month um for the schools where 69 percent of parents are in good standing with their payment profile that is the best month right now as it stands for the month of november october september we're sitting at 46 percent 47 percent so parents are entering the new year with huge burden of debt in terms of school fees that are outstanding into the january period and the whole process starts all over again as parents are going to have to not just pay for school fees fees but pay for the back to school expenses stationery school uniforms etc that children have so i guess from a store card perspective if you are going to be spending on your store cards it it should be things like um it not consumables like we don't want to spend money on food and drink if it bless you if it can be um if it can be avoided but rather spend on if store cards are required spend it on things like your stationery your school uniforms the things that you are going to need um in the new year and that's certainly one of the things that i think parents right now thinking about i've seen social media your parents even talking about school fees and how they are behind on paying school fees and some of them also just feeling a bit short change because of the nature of how schooling has been i mean there was an extended period where kids were not going to school because of hard lockdown not every school had been able to you know jump on the online band bandwagon early enough and even when they did parents were essentially doing quite a lot of the teaching so they there's almost you know uh uh a tug of war so to speak between you know the parents and the schools because some feel look fees this year should actually go down given the the nature of how 2020 has slowly um unraveled now we're going to go for a quick break when we come back we're going to be exploring what do we then do in the event where we did mess up our credit score in 2020 how do we go about repairing our credit score as best as we can because we know that a bad credit score can close so many doors we always want to make sure that we have a healthy credit score as much as we possibly can but mistakes happen pandemics happen a global one at that and there's certainly ways that we can now start thinking about ways to repair our credit score as best as we can and one of the big questions that's you know tends to come up quite a lot and I know it came up two weeks ago when we had absa talking about debit orders is how long uh you know does repair take but also what happens if you miss one or two debit orders you know does your credit score almost immediately go down uh what essentially constitutes a makes your credit score uh slowly go down those are some of the things that we'll be exploring just after this break back to the monday edition of the private property podcast i'm your host ozamantou moa kumalo this evening we're looking at a topic that I know we talk about a lot of course credit scores but we're also looking at the mistakes we should be avoiding during this festive season we know that a lot of us may perhaps be tempted uh you know to spend outside of our budget but you want to make sure that you plan as efficiently as you possibly can because negatively affecting your credit score can have so many consequences that we often don't think about on the spot we're also going to we're also quite excited and this is something that I know I've been talking about a lot about a new web series that's coming to your screens at 8 p.m uh this whole week except of course in the public holiday and that's where we're going to be speaking to ppc uh along how we can build stronger homes we're going to be exploring various themes throughout the course of the week and really a great conversation if you are either renovating your home building a home or are going to be doing so anytime soon some of the things that you need to be thinking about when you're even viewing a particular home so if you have any property goals and you know that uh you know part of your property goals is perhaps buying that new home you want to make sure that you tune into the special web series that's going to come into your screens every day this week at 8 p.m and that is building stronger homes bought to you by ppc now to get back to our conversation I'm speaking to Michelle Dickens who is the management director of tpn credit bureau now Michelle before the break I did say one of the big things is you know a lot of people would have potentially already gotten themselves in a bit of a bind where their credit score has been negatively affected this year and part of me says you know what of the many things that happened this year that one was probably very expected and that's probably one of the reasons why we had this conversation so many times this year because we understood that even as the you know the after effects certainly or the effects because it's not even the after effects really of the pandemic are slowly kind of unrolling one of the things that was going to be affected is somebody's credit score so now we're probably at a place where we're seeing the we're reflecting back on the year that was and we can see how damaging it was to our finances and perhaps you've now been able to you know get a new job or certainly get your finances in a slightly more stable position but you need to be able to repair your credit score perhaps take us through how do we then go about repairing our credit scores as best as possible so the first step is to get a copy of your free credit report and that that's step number one look if I was to assess all the active tenants in South African and what tpn does is recollect data on a rental payment profile basis how tenants are paying their rent on a monthly basis but also on top of that we recredit vets all those active tenants on the database to assess what their overall credit score is to get a benchmark for all active tenants in South Africa in a formal rental market and we score our tenants using a credit score and those tenants coming into a lockdown 67% of those tenants were a a b or c which is a quality score and in an f would be a not so quality score so 67% of all active tenants were scoring quality score that deteriorated only in the month of july and it dropped down to 65% of tenants so there was a 2% decline that was because of all those payment holidays that were offered so there were a lot of payment holidays and covid relief holidays that were offered the score deteriorated again only in october only down to 64 and and it has popped back up in the month of november and december back up to 65 so i think that there were a lot of payment holidays offered to individuals and people need to remember to take advantage of those and reach out to their credit providers so my first piece of advice would be get a copy of a credit profile have a look at it and determine where you are at in your um journey on your personal credit profile remember that credit scores are unique to the credit bureaus so each bureau is going to have a slightly different um score um in terms of tpn we partner with trans unions so go to mic trans union dot c dot z dot for a look at your full credit profile tpn then supplements that with your school payment profile and your rental payment profile and individuals are absolutely welcome to come to tpn dot c dot z a and access their pre-paid profile with us as well in terms of their credit providers credit providers don't just look at your credit bureau information but they additionally supplemented with the transactional data that they have on you as well so they look at you in terms of their own internal data on how you um transact with um with them in terms so then you would look at your bank for your transactional banking um payments um as well so first have a look at your credit profile and then assist number one are their debts on your credit profile that you can now repay so um in order to get a judgment list on you you have to have gone through the process of or the credit provider will have to have gone through the process of going to court and getting a judgment um issued against you if you are not in a position where you can repay the value of that judgment just the capital value of that judgment that was outstanding once you've settled that it's got to be removed from your credit profile because credit bureaus cannot store information on your profile where you have settled the amount outstanding similarly with the default a default is where credit provider has loaded a default on your credit profile um with the bureau that they belong to so it's not necessary that a default will be listed on all the bureaus um so at my trans union if you see there's a default on your um on your credit profile the process for that default to have been listed would mean that the credit provider would have had to have given you a letter of demand they would have had to give you 20 business days notice of their intention to list you on the credit um bureau and your account would have needed to have been three consecutive billing cycles in areas at the time that they would have had listed you so either you didn't receive your notification of their intention to list that's a technical reason why the default could be removed against your credit profile or two you could now be in a position to settle that debt or you've already settled settled it and again you've got seven days where the bureau is going to then remove that information from your um from your credit profile so any of those paid updates go log a dispute with the with the bureau to have that information removed from your credit profile in terms of your payment profile information this is now on record depending on the bureau for between two and three years so if you didn't pay something in july 2020 the fact that you are one month two months or three months behind sits on that month for the next three years it'll take two to three years depending on the bureau to slowly work its way back into back into the history of your credit profile so what you want to do you need to understand it's going to be there if you can don't miss if you have you need to understand that every month that you catch up and get that back to on the pad on time and then full status it improves your credit score because the weighting is based on the recency more recent adjustment defaults or non-payment the more it weights against your negatively against your credit profile and the further back that gets into history the less weighting it has on negatively affecting your credit profile you've actually answered you know one of the questions that then we did get around when you do miss that debit order at which point does your credit score go down because i think that's one of the uh you know questions that we tend to get quite a lot because people want to better understand at which point exactly does your credit score go down but also at which point does your credit score go up because you're almost you know trying to slowly work through it and perhaps you can share a bit of share a bit of light with that one which are you know at which point is your credit score going to slowly be going higher and higher um especially as you're slowly sort of paying off your debt or perhaps when you've you know started new debt in order to build up your credit score what kind of sort of time frame should you be looking at in order for you to almost max out to get the highest score you possibly can yeah so each bureau looks at it um differently and each credit provider will supplement and potentially even have their own score based on the data that they're looking at and even a credit provider will have a different score based on whether it is a home loan application a car loan application or personal loan um application and absolutely um for for for a home loan you might find that the um the weighting is much higher and the score is more affected but for personal loan there's there's a lot more leeway given in terms of what is on your on your credit profile for a thin file so a thin file is where a credit provider or a credit bureau is trying to screw you but there's insufficient data in order to score you you don't have an account there's there's no history of how you pay any form of um of account and so initially what we need to see there is we need to see at least six to twelve months worth of transactions as to how you manage that um account over a period of time again depending on the type of account that you're looking to um access in terms of um how quickly will it affect your score if you miss one month and you catch it up the next month absolutely it's going to affect your score there's there's no doubt about it if it's one account to a tally of 10 accounts maybe it's not going to affect your score as much because you've got nine other accounts that you are paying and you're paying on time so it depends on how many accounts you have to what level you are indebted so not only are the bureaus looking in terms of your score as to how those accounts are paid but what is the value outstanding so what is your total exposure to all of your credit agreements you have a million rand on a on a home loan you have five thousand rand on car finance and you have ten thousand rand credit cards two thousand rand store cards um you have expenses to your insurance your telcos what is your total um exposure and then what is your monthly commitment to those and what is the total rand value of the rears of all those again if you have a home loan that's outstanding for ten thousand rand one month miss that is different to if you have a store card outstanding of two hundred rand so what is the total value that's outstanding and how many months in a rears are those as well i've got a question here from ustevi on our facebook page asking where can one get his credit profile so if you want that credit score where can they go not trans union best place to go www.mytransunion.co you can do it online or online it's online it's free you're able to get that uh check per annum free across the different credit bureaus and you're able to just utilize it i think if you know that you're maybe not in the market for anything it also just helps you get a sense of what your credit profile is looking like what's on it right now and it also just does help you starting to plan in the event way in the new year you might look at buying for example a car or house and in the event where there are things that shouldn't be on there you can already start following up on them now now michelle before i let you go any final tips for our viewers at home around what they should be avoiding this festive season um that could potentially jeopardize their credit score i guess from from our perspective is keep her close tell you on your budget make sure that you stick within your your budget we are instant gratification people we like to spend we like to spoil um and the best way to keep ourselves in check certainly for me is to have a budget and to make sure atomize mom value 300 range dad value 350 no i like 300 you know what is my budget per person and then go out to find gifts that match um those budgets even on your personally what i do for my social spending is um this is my little and i do it in cash i'm looking at like them and i have a little cash social spending uh you know whatever envelope and when i run out it's right now that that's um i'm done yeah it's actually such a great i mean there was a there was a point i think early in my 20s when i did that way i draw out the social money and i'd be like this is the money for the month um or if it was on a weekly basis and if this runs out on that first weekend then they're more social um and it really does help because more often than when you're just swiping and swipe you don't really think about it's just it's there somewhere you know there's money in there can't but you just don't want to think about it we're gonna look at the balance um and even you know over the weekend you'll be in a whether it's a restaurant or probably ever you're just swiping swiping swiping without being mindful of just how much you've been swiping so having those cash envelopes helps so much because you know that look this is for week one up to week four and if you're gonna dip into week two during week one then you have to already start adjusting your social plans for the other weeks so dealing with cash does help quite a lot i mean i found this also just this mental shift uh where you also just start realizing that oh my god actually paying 400 grand for a lunch out uh with friends and let's say it was a short lunch is actually so much money because like that's where you actually start realizing that that's a lot of money on you know just a quick one hour lunch uh maybe rather not do that maybe just grab a quick coffee and do lunch at home so all those little you know tricks certainly do help in making sure that you keep your budget um you know inform as much as possible now michelle thank you so much for joining us this evening i know we're going to be speaking to quite a lot in the new year thank you thank you very much for always making time to speak to us in the private property podcast this year and wishing you certainly all the best for the festive season to your team at tpn as well as your family thank you zoma always nice to catch up with you it's a pleasure and that's michelle dickens who's the managing director of tpn creative bureau well that's a wrap from us here on the private property podcast remember we're launching that special web series brought to you by ppc where we're building stronger homes that's certainly one that you do not want to miss out that's coming out of coming up rather at 8 p.m you can see how excited i am i'm even rolling over my words because it really was that good i think if you have a property you're looking at having a property you're looking at doing a property whether you're looking at renovating your home regardless of how big or small the renovation project is you want to make sure that you tune into building stronger homes brought to you by ppc it's such a great web series and we spoke to us certainly spoke to a whole host of different guests that helped us navigate different topics from making from essentially asking how do we build stronger homes so that's some of the things that we should be thinking about when we're building for safety and for legacy as opposed to wanting to you know cut corners and save brands now but certainly that's going to catch up with us in the long run and of course remember to enter our very very exciting competition make sure to ask your friends and family at home if they can be part of your team come up with creative team names i already want to know what your team names are let us know down here on your social media platforms you can also reach me on my own social media platform and at zamantunga underscore k where we're quite excited to be giving away up to a hundred thousand rand this whole december and of course that's going to be split across different awards and certainly different competition across our social media platforms remember you have to be following us on that social media platform in order to stand a chance to win we are in a festive mood in a very giving mood so make sure that you get your team members ready for what's going to be a really great competition where we ask questions for the legends well that's it for me zamantunga kumano and the rest of the team where i'll be back on your screen for the private property podcast tomorrow at seven remember to watch building stronger homes at eight and until tomorrow hoping staying home and staying safe we surrounded by so much natural beauty and we love that it's so casual it's just not as intense as a busy city in fact that's one of the main reasons there's so many people moving into the area there's some amazing lifestyle estates out there we've got some barley breton wood estate and some beauty to name it for the belito lifestyle center kates us to everyone's needs there's also some smaller commercial centers like tiffanese and salt rock there's some excellent restaurants to choose from and there's a really wide variety of activities on offer from mountain biking out on the trails to surfing at any one of the beaches there really is something for everyone this quiet little town really comes alive over the weekend the live concerts in the farmers market at the beach orchard with the new international airport just 15 minutes down the road and the unmatched lifestyle that this place offers it's no wonder that the north coast is the fastest growing town in south africa my family and I absolutely love it and this is how