How to buy a car if you are blacklisted

If a poor credit record is making it difficult to get vehicle finance, you still have options. From prepaid car subscriptions such as DrivePass to buying with cash, personal loans or rent-to-own, here are the routes worth considering.

Being turned down for vehicle finance can be frustrating, especially when you need a car for work or family life.

“Blacklisted” is commonly used to describe a poor credit record, often linked to missed payments, overdue accounts or judgments. Understanding your credit profile is a useful first step – but there are also other ways to get mobile.

1. Consider a prepaid car subscription with DrivePass

DrivePass, Cars.co.za’s prepaid car-subscription offering, gives you access to a car without the need for vehicle finance.

There are no traditional credit checks or requirements to submit bank statements and payslips. A poor credit score does not prevent you from using the offering.

One of its biggest attractions is access to virtually new cars, with a range stretching from small, entry-level hatchbacks to larger family cars and SUVs. You can choose a vehicle that suits your needs and budget, subject to availability.

How does it work?

Choose your car, pay a refundable deposit and your first 30 days upfront, then top up your account for each additional 30-day period.

There is no long-term lock-in, and you can change or cancel your plan without cancellation penalties. To cancel, return the car and end your subscription.

Your monthly payment includes insurance, servicing, maintenance, warranty and tracking. You don’t even need to worry about replacing the tyres. Pretty much, add fuel and go.

There is a mileage allowance, with additional charges if you exceed it. Tolls and traffic fines are also separate.

You need an eligible payment card and a valid driver’s licence first issued more than a year ago. Card requirements vary by subscription price.

The subscription does not automatically transfer ownership to you, although purchasing the car you are driving is very possible to do once you have the credit profile to qualify for the finance.

Browse available DrivePass cars and monthly prices

2. Buy a car with cash

If you have sufficient savings, buying with cash avoids the need for vehicle finance. Choosing a less expensive car could make this more achievable.

Leave money available for insurance, servicing and unexpected repairs. If a friend, family member or employer helps fund the purchase, agree clearly on any repayment obligations.

3. Explore rent-to-own or rent-to-buy

These arrangements generally involve an upfront deposit followed by payments over an agreed period, with ownership dependent on meeting the contract’s conditions.

That period can be lengthy – some agreements run for five years before you can exercise the purchase option. Consider whether you can sustain the payments for the full term, including any final purchase payment.

If you leave before completing the ownership requirements, you may have paid to use the car without ever owning it. In fact, it is much more common for the agreement to end early than it is for the customer to ever ‘own’ the car. In these cases the outcome resembles a rental, and an expensive rental at that.

Before signing, check the total cost, what the payments include, when ownership transfers and what happens if you end the agreement early.

4. Consider alternative lenders and personal loans

A personal loan is another possible way to fund a car purchase, provided you qualify. Specialist products are available, including offerings such as WesBank’s CashPower personal loan. Approval still depends on the lender’s assessment.

The amount you qualify for may be relatively small, which can put older, less expensive cars within reach rather than newer models. Allow for their potential maintenance and repair costs when setting your budget.

Search for current products and compare the available amounts, interest rates, fees and repayment terms. Check the total amount repayable – not just the monthly instalment.

Keep working on your credit profile

Alongside meeting your immediate transport needs, review your credit report, address incorrect information and work towards keeping payments up to date.

If you need access to a car while exploring your longer-term options, find out more about DrivePass.