Navigating financial challenges when paying your vehicle finance instalment

Street Smart Series

My Money Matters Written by  Absa Staff writer 

For us South Africans, car finance is an essential service and after our houses, probably our biggest expense.

That said, South Africa’s economy has been facing some challenges, which has caused many of us to tread carefully when making big financial commitments, like buying a house or a car.

One of the challenges we face is, what happens if we can’t make our loan repayments? You don’t want to find yourself in a situation where you are struggling to make ends meet, you’re thinking about selling some of your valuables and your stress level is rising like those loan re-payment statement letters you keep avoiding.


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Being in a financial slump can be quite scary, but this is the time to face your problem head on and not resort to ignoring it. Meaning, get PROACTIVE! So, how do you do that

Firstly, call the bank. You can ask for lower repayments for some breathing room or ask them to put the money in arrears back into the loan amount or even extend the repayment term so that your instalments are smaller. Banks like Absa are run by people who get the landscape of our economy and how one can fall on hard times, so call and state your case so they can try and work out a solution for you.

Secondly, sell the car. Absa can easily help you with this. We can help you register your car on our FASTBuy platform, which gives you access to over 400 dealers looking to buy cars. You can start this process by sending an email to An Absa agent will call you to kick-start this process*.

Another option is voluntary surrender, meaning considering giving the car back to the bank. Giving your car back to the bank may feel like a defeat or loss, but remember that in the long run, it may be a smart move because downgrading can save your credit record and it's less embarrassing than a sheriff repossessing it.

Just keep this famous army general quote in mind, “You’re not retreating, but merely advancing to a more tactically advantageous position.” 

Now that wasn’t so scary was it? But keep in mind, if the car is not paid off, the bank owns it. And these options only work if you follow the advice well ahead of when the problem arises.

In a more positive light, as a bank, we’ll always do our very best to assist you in resolving the issue since we do care about our customers' financial security. By ignoring repayment notices, you'll only end up wasting your money on additional legal fees and, honestly, you may end up without a car.

Buying a car need not be a fear-based decision, but you need to assess your finances- and weigh up the pros and cons. When looking at luxury SUV’s ask yourself: Do I really need an SUV, when maybe an affordable little budget or compact car will do? The goal with all financial decisions should be to keep a clean sheet. 

Always protect your credit score by paying your accounts on time and putting your hard-earned money towards paying off your loans, act responsibly now and enjoy your car without having repayments keeping you up at night.

If you are an Absa customer and would like to find out about making alternative payment arrangements, contact 0861 222 272.

* This service is exclusive to Absa Vehicle and Asset Finance customers in financial distress.

Disclaimer: The advice contained on this blog is for general purposes only and does not take into account individual circumstances, objectives or financial needs. Accordingly, readers are advised to seek appropriate advice from licensed professionals prior to making any investment, or taking up a financial product or service.