Buying a car is a major expense which takes a huge cut out of your salary. Living in South Africa, however, and taking into consideration the long distances that people travel daily in order to get to and from work, most people opt to buy their own means of transport in order to do so. Very few people, however, when buying a car in South Africa, are able to do a cash deal, and most rely on financial institutions in order to be able to do so. You might not always get the best terms when negotiating a loan to buy a car. There are many reasons why this might be the case and many criteria that are taken into consideration when you are offered a loan.
Things do change, and therefore re-financing gives you the opportunity of paying off your current loan with a re-negotiated one. This means your current car loan and its title is transferred to a different financial institution to which you from then on pay your monthly instalments.
The benefits of re-financing your car
- The interest rate is usually lower
- Your monthly instalment is usually less
- You could probably pay off your loan much quicker
- You could possibly be exempt from making payments for either one or two months
Additionally, where your loan amount is more than the real value of your vehicle, re-financing usually corrects this scenario. In the end, re-financing your vehicle saves you money. There are, however, a few disadvantages you should be aware of when looking at new car deals in South Africa.
Disadvantages with regards to re-financing your vehicle
- Reapplying for a loan could possibly have a negative effect on your credit score
- There would probably be financing fees charged
- Of course, you might not qualify
Before you decide to take the plunge and try to re-finance your vehicle, you should make sure that both you and the vehicle in question meets all the requirements. Keep in mind, though, that different financial institutions have different requirements.
Requirements for re-financing your vehicle
- Are you a South African citizen?
- Do you have a good credit rating?
- Do you have a valid South African Driver’s Licence?
- The car model should not predate 2001
- Your car’s value is at least R45 000
- You have a salary of at least R6 500 per month
How can Citton Cars help you with your re-financing?
Citton Cars have designated people that are on site who specifically deal with all the financial aspects of finance and re-finance. They are able to guide you through the process, explain all the details, and help you get the best deal available to you, taking all factors into consideration.
Stop by or contact us at Citton Cars, the used car dealership in Pretoria that has won numerous awards over the last number of years, and see what our people can do for you. You are under absolutely no obligation to sign any contract when getting your quote. Our business is people, and client satisfaction our measure of quality service.