Garnishee order creates amnesty concerns

A Fin24 user wants to know if having a garnishee order against him would prevent him from getting credit amnesty or a home loan. He writes:

I have a garnishee that is being deducted from my wages every week.

I would like to know if I qualify for amnesty, and whether it will affect my application for a home loan.

Wikus Olivier, a debt counsellor at DebtSafe, responds:

If you have a garnishee on your salary, it means that there is a judgment on your name as well.

A judgment on your name will most definitely reduce your chances of getting approved for a home to almost zero.

Most credit providers have a policy of immediate rejection should a judgment be present on your credit profile.

In terms of the credit amnesty, there might have been a solution.

During the amnesty period, which was from April 1 2014 to May 31 2014, all adverse listings were removed from consumer’s credit profiles.

This included listings like default notifications, absconded and even judgments.

Even though the judgment debt might not have been paid in full, the listing would still have been removed.

I suggest that you pull a credit report from TransUnion to determine the status of your credit profile.

Please note that even though the judgment listing might have been removed, you are still liable to repay the debt.

If your payments are not made in accordance with the judgment order, the listing will return to your credit profile, putting you back at square one.

In terms of the new credit amendment bill, the publication of which we are all eagerly waiting for, a judgment listing must automatically be removed once the judgment debt has been settled in full.

In the past the judgment listing stayed on your credit profile for five years maximum or until the judgement had been rescinded.

The new law will ensure that consumers recover a lot quicker after bad debt had been settled.

It would also be wise to follow up with the creditor who garnished your salary.

Find out what the outstanding balance is and ask him to provide you with a statement reflecting all the payments you have made on the debt.

It might be that the debt is very close to being settled and you could possibly negotiate a discounted settlement amount.

I would strongly recommend that you settle all your debt first before attempting to apply for a home loan.

Adding more debt to an already strained salary will most likely cause more harm than good.

*Add your voice by sharing your debt  experiences, debt-busting tips and insights. Have a question? Ask our experts.

Disclaimer: All letters and comments published in The Debt Issue have been independently written by members of the Fin24 community. The views are therefore their own. Fin24 cannot be held liable for any decisions made based on the advice given by Fin24 users and debt experts. Under the ECT Act and to the fullest extent possible under the applicable law, Fin24 disclaims all responsibility or liability for any damages whatsoever resulting from the use of this site in any manner.

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