It’s the month of love where many men will go on their knees and ask the ones they love to marry them. Some have weddings planned for Valentine’s Day. At this point of a relationship couples have already taken the time to get to know each other, their strengths, weaknesses, what makes them happy, etc.

The real question is how well do you know your future spouse’s financial habits – especially if you plan to marry without a pre-nuptial contract! How much debt do they have? Do they service that debt well on a monthly basis? Do they save? Have you seen their credit bureau reports? Are they blacklisted? Are they under debt review? Do they max out their credit cards every month? As unromantic as these questions are – they are an important aspect of any relationship. “Many couples avoid this topic completely until they are in a marriage. Some believe that this is a topic only for married people while others simply don’t have the courage to start the finance conversation,” said Mr Nicky Lala-Mohan, the Credit Ombud.

In some cultures, a man asks for a lady’s hand in marriage in the form of lobola [bride price]. “Some will save up for the lobola, while others might apply for a personal loan or use their credit cards,” adds Lala-Mohan. Whenever a person is granted a personal loan or has a credit card or any form of credit agreement, the information is recorded in the credit bureaus in the form of a credit report. Ladies might not be brave enough to ask that their future spouse wrap their engagement ring in a credit report. The same applies for the men: the lady’s “YES” is not requested to come with a credit score. As unattractive as this may be, understanding one another’s finances and credit should be discussed in any relationship. 

All South African consumers have the right to request a free credit report from a registered credit bureau, once every 12 months. However, statistics sadly show that less than 1% of consumers exercise their right to request their credit reports.

The Credit Ombud says it’s as if consumers would rather not know what’s on their credit reports. “This is a culture that we need to change. There is nothing to be afraid of. If there are problems, rather see what they are so that you can deal with it or correct wrong information. Asking for your report will not make things worse – in fact the opposite is true. Therefore, the best advice we can give consumers is: check your credit reports regularly.”

The sad reality is that many couples discover issues like bad payment behavior, poor credit scores, blacklistings or even debt review after saying “I do” and depending on the type of marriage, they end up saying “I do” to their spouse’s debt too, which can frustrate the process of big purchases such as a home or a motor vehicle or whatever the newlyweds need to obtain on credit.

The perception is that credit bureaus are the bearers of bad news and that a credit report is all ‘doom and gloom’ with just negative information. Credit bureaus keep both positive and negative information pertaining to consumers’ credit accounts. When consumers open accounts, the information is sent to the credit bureaus and is reported in the form of a credit report. A credit report is a detailed report listing a consumer’s credit accounts, when they were opened, account balances, amount of the monthly installments, how consumers are paying these accounts on a monthly basis and any negative listings on overdue or unpaid accounts. Each month a consumer makes a payment, skips a payment, pays late or short pays, the information is reported in their credit report. This means that your account payment behavior is reflected in your credit report.

Lala-Mohan highlights the following advantages in obtaining a credit report:

1.    Check your credit report regularly, you will know exactly what information is listed and couples should be brave enough to share this information with their prospective partners to see what debt each of them is bringing into the marriage.

2.    It will give you details of adverse listings and if there was action taken against debt that was not honored.

3.    The account history gives you your payment patterns and how accounts are conducted on a monthly basis.

4.    The account application history – known as the enquiry history – will give you a list of applications made in the last 12 months.

5.    You are better protected against identity theft because it is easy to pick up irregularities and sort them out before it becomes a bigger problem.

It is important to access your credit report regularly because you cannot fix what you do not know, Nicky Lala-Mohan adds.

Over-indebtedness, impaired credit reports and bad financial habits have the potential to choke a marriage to death.

Consumers can contact the office of the Credit Ombud for FREE assistance if they experience any issues relating to credit agreements with non-bank credit providers such as the clothing and furniture retailers as well as micro-lenders, fraudulent listings, emolument attachment orders (“garnishee orders”) or general complaints about their credit bureaux listings. The office can be contacted on 0861 66 28 37; on the website www.creditombud.org.za; email us at ombud@creditombud.org.za or send a sms to 44786 and we will call you.

_____________________________________________________________________________________

If you would like more information about this topic, please contact Salem Dyafta at 0828741537 or email at sdyafta@creditombud.org.za.