Buying a vehicle is a long-term decision and we want to help you make an informed one with our Street Smart series, brought to you by Absa Vehicle and Asset Finance. In this episode, we chat with Absa’s Chelton Keppler about dealing with challenges to meet your vehicle-finance loan repayments.
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When your finances take an unexpected turn and you struggle to pay your Vehicle Finance Loan, it’s important to understand your options and take the necessary action. Chelton Keppler from Absa gives us some insight into the options available to help get you back on track.
What is the first thing that you need to do when you realise that you’re going to battle to make your payments?
KEPPLER: Be sure to contact the bank as soon as possible, so that the bank can help you with alternative ways to meet your financial obligations. Don’t think that the problem will just go away.
What options are available to individuals struggling to meet their financial obligations?
KEPPLER: Well, the available options include the restructuring of payments, also known as forbearance. This option allows you to restructure your repayments under your Vehicle Finance Agreement.
Examples include:
- A short-term payment plan. This option allows you to pay a percentage of the contractual instalment for a maximum period of six months.
- A long-term plan. Here, the term of your Vehicle Finance Agreement can be extended to reduce the instalment amount.
- Small arrears capitalisation. An arrears amount of not more than two months’ instalments can be capitalised on your outstanding balance and your term can be extended to ensure that your instalment is not negatively impacted.
Terms and Conditions apply to these options, which will be discussed when you contact the bank.
If you’re unable to continue with repayments and want to avoid the repossession of the vehicle, you can use our HelpUSell process to market and sell your car to one of our approved dealers, provided you meet the qualifying criteria.
You can do this on our secure FASTBuy platform. You’ll need to accept the Terms of Use and complete the registration process, including uploading images of the vehicle on the platform, to make your vehicle available for sale. You’ll be notified of any offers made on your vehicle. You can then accept an offer that will help you reduce the outstanding loan amount on your account.
How does one deal with a deceased estate when there is an outstanding amount owed to the bank on the vehicle?
KEPPLER: The deceased’s next of kin must notify the bank of the death and our Deceased Estates team will engage with the appointed executor around available options to settle the bank’s claim. Where there is credit life insurance or other life insurance, a claim needs to be submitted to the relevant insurer. If there is no insurance cover, the executor can arrange to settle the account from the estate funds, or sell the vehicle to a third party or dealer.
If the estate doesn’t have enough funds to settle the balance and there are no offers, the bank can arrange with the executor to sell the vehicle at an auction and the proceeds will be allocated to the account. The estate will be responsible for any shortfalls.
To access the Deceased Estates Guide, please visit absa.co.za or call us on 0861 113 003.
For more information or help, call Absa Vehicle and Asset Finance on 0860 669 669 (select option 2).
For extra information on how you can become a better consumer, keep a lookout for more episodes from our Street Smart series and be sure to visit the Absa blog.
Other episodes in our Street Smart video series:
Absa’s Sarvas Naidoo and CMH’s Joel Chetty about balloon payments.
Absa’s Fulufhelo Mandane and Hatfield VW Melrose’s Vleis Manyama explain the importance of getting and maintaining an acceptable credit score.
Absa’s Sbu Dhlamini explains the most pertinent terms in an instalment sale agreement. Understanding your instalment sale agreement [Part 1] and [Part 2]
Absa’s Michelle Moodley emphasises the importance of taking precautions to avoid falling into fraudsters’ traps. Vehicle Sales Fraud: What to look out for
Absa’s Fulufhelo Mandane discusses what you need to consider before you start shopping for a vehicle, the costs of ownership and your various finance options. Absa First-time Buyer Guide to Vehicle Finance
Absa’s Gordon Wood details how the new Aftermarket Guidelines, which were introduced in the motor industry last year, affect you as a vehicle owner. Absa’s Guide to Responsible Vehicle Ownership
Related content:
The New Normal, Podcast 3 – Time to revise your car insurance?
The New Normal, Podcast 2 – Car Dealerships of the Future
The New Normal, Podcast 1 – Changes in SA’s car-shopping patterns
