ITC Clearance for People with Small Debt
Can you get ITC clearance if you only have small amounts of debt? ITC clearance is the process of clearing negative financial information from your credit history or record. There’s no specific clearance process for small debts, but there are things you can do to address them.
Here’s how to approach it with small debts:
Pay Them Off:
This is the most direct route. Settling your small debts entirely shows your creditworthiness and will be reflected positively on your credit report.
Negotiate Settlements:
For some debts, you might be able to negotiate a lump-sum payment to clear them with the creditor. This can be a good option if the total amount is small. Always get any agreement in writing.
Consider Debt Review (with Caution):
If you have multiple small debts, debt review can help consolidate them and potentially lower your monthly repayments. However, debt review comes with a flag on your credit report that can affect your ability to access new credit for a period. This might not be the best option for small debts alone.
Remember:
Time is a Factor:
Even small unpaid debts can hurt your score for years (usually up to 7 years in South Africa). The quicker you address them, the faster you can improve your credit standing.
Focus on paying off or negotiating settlements, and prioritize on-time payments moving forward. This builds a positive credit history and shows responsible financial behaviour. Also, remember to grab your free credit report from Credit Boost to check your progress. And if you’re unsure how to proceed, consider consulting a credit counsellor or financial advisor for personalized guidance.
By following these steps, you can work towards improving your credit health even with small debts. There’s no magic solution, but consistent effort over time will get you there.
