What housing options are available to me if I earn over R3,500 a month and am blacklisted?

The long answer

There is a government programme called the Finance Linked Individual Subsidy Programme (FLISP), which helps people who earn less than R22,000 a month to buy a house for the first time with a grant that can be used as a deposit or to reduce monthly payments. But in order to qualify for FLISP, the bank needs to agree in principle to give you a home loan, and as you say, they will not agree to a home loan if you have a default on your credit record (blacklisting).

The only other government housing scheme which might apply to you is the Social Housing Programme (SHP) which is mainly (but not only) aimed at assisting couples or single people with dependents earning between R3,500 and R7,500 a month to rent affordable housing. The way it works is that the local municipality or provincial government will subsidize the building of new housing projects if some of the housing is rented out as affordable housing. 

The municipality must conduct an Integrated Development Plan every five years to work out what the housing needs are and decide on SHPs. You can approach the municipality and ask what SHP projects exist and how you can apply. For some SHP projects, you will have to apply directly to the company building the houses.

The other approach is to try and pay off your debt as soon as you can, so that you can clear your credit rating, qualify for a home loan and apply for the FLISP grant. If your debt is to one company, the best thing would be to approach the company and settle the account. They may be willing to negotiate a settlement with you. Part of that settlement should be that they agree to write to the credit bureau informing them when your debt has been paid and asking them to delete the debt from your record. 

If you have multiple debts and can’t pay them off immediately, it may be best to go into debt counselling, where your debts are consolidated and paid off over time. You need to be careful to choose an established debt counselling company with a good track record, though, because there are untrustworthy companies eager to take your money without paying it over to the creditors.

If you check your credit record and you see that there is information about the debt that should have been removed, you should write to them immediately asking them to remove it. They have to respond within 20 days.

Wishing you the best,
Athalie