When you’re ready to apply for vehicle finance or a home loan in South Africa, your credit profile plays a critical role in whether your application will be approved — and on what terms. But before jumping into the process, it’s worth taking a step back to understand how your credit profile works, what credit exposure means, and how to position yourself for the best possible outcome. We will show you how to How to build your credit score for vehicle finance.
In this blog, we’ll break down:
- What your credit profile and credit exposure mean
- The difference between the two
- Why they matter
- The dos and don’ts when applying for credit
- Practical tips to build your credit score
Start with the Basics: What Is Your Credit Score Profile?
Your credit profile — also referred to as your credit score — is essentially a reflection of how you manage debt. It tells a story of your financial behaviour, and it’s one of the first things any bank or lender will check when you apply for credit.
In the past, it took time for banks to access and interpret your financial history. Today, that’s no longer the case. Thanks to technology, banks now have near real-time access to your payment history, account balances, debit orders, and more. They can even see expenses you didn’t list on your application, like that gym membership or clothing account instalment quietly being deducted every month.
That’s why honesty in your application is crucial — because the system already knows.
Your credit score isn’t just about whether you’ve missed payments. It also reflects how often you apply for credit, how much debt you have access to (even if you’re not using it), and the types of credit you carry.
Applying for Credit? Timing Matters
Timing your credit applications strategically can make a big difference — not just in whether you’re approved, but in the terms you’re offered. Banks want to see a pattern of financial responsibility over time, not a last-minute rush to “fix” your credit before applying.
Before you submit any credit application, take a few months to strengthen your credit profile. This includes:
- Settling or reducing existing debt, especially on revolving credit like credit cards.
- Paying all your accounts on time, every time — recent payment behaviour weighs heavily in scoring.
- Avoiding new credit unless absolutely necessary, as this can shift your debt-to-income ratio.
It’s also a good idea to review your credit score report beforehand. Fixing errors or resolving old issues takes time, and applying before they’re corrected could hurt your chances.
Applying when your profile is healthy, and your budget shows capacity for the new repayment, tells lenders you’re ready — not reactive.
Important to Know:
Each time you apply for credit — whether it’s a clothing account, credit card, cell phone contract, vehicle finance, insurance or a home loan — a hard enquiry is made on your credit profile. Multiple applications in a short period raise red flags and can reduce your score. If you’ve already been declined for finance due to poor credit conduct, it’s important not to keep applying at different finance houses hoping for a different outcome. This pattern signals financial desperation and will further damage your credit profile, making approval even less likely. Instead, take a step back, focus on improving your credit health, and reapply only once your profile is in a better position.
Tip: Space out your credit applications and avoid applying for multiple credit products at once.
How to Build (or Rebuild) a Healthy Credit Profile
If you’ve never had credit before or have had financial difficulties in the past, you can still build or repair your profile — it just takes time, consistency, and patience.
One simple way to start is by opening a small cell phone contract in your name. Even a basic data contract under R100 per month helps, as it reflects a regular, fixed-term agreement that builds history over time.
Retail accounts are also useful. A Mr Price account, for example, is reported across all major credit bureaus in South Africa. The trick, however, is not to pay off the balance in full at the end of the month. Instead, buy something small and pay the instalment each month. This shows you’re managing monthly repayments responsibly — something banks love to see.
And if you’ve got open accounts you no longer use? Close them. They still contribute to your total credit exposure and could be working against you, even if there’s no balance owing – this is very important in your journey to how to build your credit score
Employment History Also Plays a Role
If you’re permanently employed, it’s generally advised to be with the same company for at least four months before applying for credit such as vehicle finance. You should also aim to have had your cell phone contract and retail account active for the same period or longer.
If you’re self-employed, there are stricter requirements. Most banks won’t consider your application unless you’ve been running your own business for at least two years. In addition to this, you’ll need to demonstrate a strong and consistent credit track record — ideally over the past seven months — with active accounts such as a retail store account and a cell phone contract in your name. This gives lenders confidence that you’ve not only built up stability in your business, but that you also manage your personal credit responsibly.
What Is Credit Exposure, and Why Does It Matter?
Now that we’ve covered credit profiles, let’s talk about credit exposure — a term many people don’t fully understand but which plays a big role in your finance application.
Credit exposure refers to the total amount of credit that’s available to you, not just the money you’ve used. For example, if you have a Truworths account with a R15,000 limit and you’ve only used R5,000, your exposure is still R15,000.
The same applies to credit cards, retail accounts, or any other revolving credit facility. From the bank’s perspective, you could max them all out at any time, and that potential risk is factored into your affordability. Have a look at our infographic which explains it.
That’s why having too many open credit accounts — even unused ones — can negatively impact your chances of approval. It’s better to keep your profile lean and focused, with only a few well-managed credit lines.
How Creditors such as the Major Banks Assess Your Finance Application
When a bank evaluates your application, they don’t just look at your salary. They consider your full financial picture: your take-home pay, your monthly debt repayments, your living expenses (even unlisted ones), and your overall credit exposure.
This is all done to protect both you and the bank — ensuring you won’t be taking on more than you can realistically afford.
Smart Credit Habits to Stick To
Maintaining a good credit profile doesn’t require tricks or hacks — just good habits. Pay your accounts on time, avoid maxing out your credit card, limit how often you apply for new credit, and check your credit report at least twice a year to spot any errors.
And if you’re ever struggling to keep up with payments, don’t stay silent. Contact the creditor and explain your situation — most will work with you if you’re proactive.
One common mistake is taking out personal loans unnecessarily. These often send the wrong message to lenders, as they suggest you’re relying on debt to manage basic expenses. And with credit cards, try not to use more than 50% of your available limit — high utilisation can negatively affect your score.
Where to Check Your Credit Score
You can check your credit report for free:
- TransUnion – 1 free report per year
- Experian – 1 free report per year
- ClearScore – Free access and updated monthly
Monitoring your profile regularly helps you detect errors early and track your progress.
Building and maintaining a strong credit profile doesn’t take years — just a few months of consistent, responsible behaviour. By understanding your credit exposure, managing your debts, and making informed decisions, you set yourself up for success when it comes to vehicle finance and beyond.
Ready to apply for finance but not sure if your credit profile is strong enough? Let us help you review your options and guide you through the process.