The Benefits of Refinancing Your Car Loan

South Africa is a unique country in many ways and some challenges come with living here. One of these is a severely lacking and often unsafe public-transport system, which leads to many locals having to buy their own means of transport for daily commuting. In South Africa, as in all countries, you must apply for car financing to afford a set of wheels, unless you are wealthy and can afford to buy it cash. The situation is made more difficult with the ever-increasing vehicle prices. That is why you can also apply for refinancing a car through us. This solution is ideal to reduce your monthly instalments by extending your loan period. As a result, your debt with your FSP will be settled and you can enjoy lower payments on your daily driver.

The major financial-services providers (FSPs) in South Africa offering vehicle financing include WesBank, Absa, Nedbank, Standard Bank, and MFC (a division of Nedbank). We work closely with these providers to ensure that we can provide the best options for our clients. If you want to buy a new vehicle, apply for a loan through us. We take your information and get the best possible options from these FSPs, so you can secure your loan before you go shopping for a vehicle. By choosing this route, you will know beforehand how much money you can afford to spend on a vehicle. Therefore, you can forget about the worries of not being approved for a loan after selecting the car that you want to buy. Should the monthly payments become too steep later, we can also assist in refinancing your car loan.

Getting Smart About Vehicle Loans

Paying off a vehicle loan in South Africa is very common among the working class. However, these same people also have a laundry list of other monthly payments to worry about. The vehicle payment on a brand-new, entry-level hatchback starts at over R2500 per month over six years with a 10% deposit and no residual. Then, you are driving the most basic form of transportation that is available on the market. That is why so many people rather opt for a used vehicle. To add to the monthly costs of owning your own car, you must fill it up with fuel, which is also very expensive. You are also responsible for maintaining your vehicle. All these costs add up, which makes refinancing your vehicle a smart choice if you can no longer keep your head above water.

When you secure a loan from a major FSP, they settle the outstanding amount owed on the vehicle with the dealership and you will then owe the money to the FSP. This loan is for a set period and is settled via monthly instalments that might or might not have a balloon payment at the end. If you miss monthly payments on your vehicle, the FSP can repossess it and resell it to recoup the lost money. To avoid this, refinancing your car may be necessary to extend the term. By extending the loan term, the monthly payment will be reduced to a more affordable figure. Therefore, you will not be spending that much per month paying off your vehicle anymore, while still being the owner of it.

Being smart about your monthly expenses will always work to your benefit. Therefore, if your vehicle payments are too high, refinancing your car is a way to reduce the instalments. The only drawback is the extension of the payment period. However, sometimes you simply need the financial breathing space that a lower instalment can provide, which is why the refinance option is ideal for many people.

The economy in South Africa is tough for the working class but BIB Finance’s services offer a smart way to go about securing a loan when you want to buy a new car. We are your partner for vehicle loans and refinancing a car. We can assist in securing a loan beforehand, so you know exactly how much you can spend on buying that vehicle. For more information on how we can assist you in this regard, please peruse our website for details on our financial services. Choose us next time you want to buy a new vehicle and enjoy a hassle-free financing or refinancing experience.