It’s easy to get car finance if you have a good credit standing. But how about if you have a bad credit history? Is there a car finance plan for blacklisted individuals?
Car Finance for Blacklisted Individuals
Back in the days, only those who will be using the car for business purposes could get a car lease. Nowadays, with the help of micro-lenders, even blacklisted people can get a car for their private use.
However, expect to get high interest rates on your loan if you’re blacklisted. Lending firms will always see you as a high-risk individual that has a high chance of being unable to pay your debts on time so it’s just reasonable to get unfavourable terms on your loans.
Many people have the misconception that the only way for them to get a car is through a loan. However, you know well that this option presents bad rates that may just create more trouble for you, considering you’re already blacklisted.
Car financing may give you a more affordable method to buy a vehicle. But if you compute the overall amount you have to pay for the loan, it may be near double the original value of the vehicle you’re buying.
All hope is not lost since there are alternative options you can take to get a car finance even if you’re blacklisted.
Contrary to what most people believe, it’s not that hard to get a car finance even if you’re blacklisted. Obviously, though, you won’t be able to get a car finance from banks. What you need to look for instead are car leasing shops that offer vehicle finance for blacklisted clients without requiring a deposit.
The best alternative and the option highly recommended by credit experts is to get into a rent-to-buy car plan. Car dealers often have this in-house finance option that even blacklisted individuals can avail.
The repayment process is almost similar to car finance but without the stressful interest rates that programs offered by banks and other lenders usually have. In addition to this, rent-to-buy plans will allow you to take ownership of the car after you’ve completed a number of monthly payments.
A number of shops provide in-house vehicle finance for blacklisted individuals without requiring a deposit and without conducting credit checks.
This type of car finance is ideal if you fall under any of these categories:
- You’re blacklisted and you’re having difficulties getting a loan from a bank.
- You don’t have any credit history yet.
- You want a flexible method to pay for your car finance. You want to have the freedom to either increase or decrease the amount you pay, depending on your current financial capability.
Aside from the benefits described above, you may also receive special benefits like roadside assistance and car service support.
What separates rent-to-own options from car finance loans is the fixed monthly repayments offered to customers. You don’t have to worry about interest rates, admin fees, and service charges that just make your repayments harder to complete.
Some car dealers also allow down payments to reduce the cost of monthly repayments. If you’re blacklisted, you may not be able to afford this kind of option, though. You still have a chance to own a car since there are also dealers who have in-house vehicle finance that doesn’t require a deposit from blacklisted individuals.
Where can you get a Vehicle Finance?
In-house vehicle finance providers for blacklisted individuals in South Africa often have the following requirements you have to satisfy to be eligible for their program:
- You live in a certain area in South Africa.
- You can pay the upfront fee which is roughly equivalent to 20% of the vehicle’s overall value.
- Have the capacity to pay the minimum monthly repayment amount which depends on the value of the car you’re buying.
- You have a valid driver’s license.
- You have no criminal record and you’re not under debt administration or debt review.
Aside from these requirements, you may have to present documents similar to what you provide when applying for a bank loan.
- ID book or passport
- Proof of residence
- Recent payslips
- Bank statements
The following dealers are the most reliable establishments you can find in South Africa that provide rent-to-own and more affordable vehicle finance plans for blacklisted individuals.
Some of them have simple pre-qualifying criteria that will identify if you’re eligible to receive their vehicle finance service or not. You just have to fill out the pre-approval form available on their website. Once you’re done with the form, submit it and wait for their response within 24 to 48 hours to know if you qualify or not.
The maximum lease period they offer is 5 years. If you don’t want to continue paying the loan, you can just return the vehicle and comply with the other requirements stated in your contract.