How long does vehicle finance approval take?

Vehicle finance is a specific type of loan that allows you to spread the cost of your vehicle over several months or years, instead of paying for it upfront in one go. It makes the payments for an otherwise unaffordable car more manageable within your monthly budget. Vehicle finance approval timelines vary widely, depending on your credit score, how organised you are, and the lender’s requirements.  

This guide explains how long you might typically have to wait for your vehicle finance to be approved, factors that may slow down the process, and ways to fast-track your application and get behind the wheel more quickly.

Tip: JustMoney’s vehicle finance calculator helps you estimate your monthly car repayments and the interest you’ll pay over the loan term.  

Timelines for vehicle finance approval 

Once you’ve found the right car, the next question is how long loan approval will take.  Several factors can affect the timing, so it’s helpful to know what to expect.  

Different lenders have different approval timelines 

Navigating the finance process at dealerships can vary in speed, largely influenced by the lender’s procedures. While some lenders offer fast approvals within the same day or 24 hours, others may take several working days, particularly if an automated decision isn’t possible.  

“Keep in mind that if you apply over a weekend or before a public holiday, your application will only be processed once business hours resume,” says Dumisani Zwane, executive: sales channels at Nedbank’s Motor Finance Corporation (MFC).  

Additionally, finance providers might request further information before finalising their decision, potentially prolonging the process. Nonetheless, approval can be quick. According to Lebogang Gaoaketse, head of marketing and communication at WesBank, WesBank customers, for example, typically receive approval notifications within 15 minutes to an hour. 

"Because lenders use different systems and processes during the application stage, the feedback time will differ from lender to lender,” explains Gaoaketse. 

Factors that affect approval time

Several factors influence the approval time for vehicle financing. Here is what helps speed things up: 

• A good credit score: Lenders are more likely to quickly approve your application if you have a strong credit history.
• Proof of income: Remember to share recent payslips and bank statements with the lender.
• A deposit: Even a small deposit can help. No-deposit applications often take longer to assess.
• Low debt levels: Less debt usually means a better credit score and more finance options.
• Financing a new car: New cars are simpler to finance. Used or modified vehicles may need extra checks, slowing things down.
• Complete and accurate paperwork: Incomplete or incorrect forms are a common cause of delays. Double-check everything before you submit.
• A manageable debt-to-income ratio: Even if you earn well, having too much debt can raise affordability concerns and hold up the process. 

Instant vs manual approvals 

Automated systems can quickly approve applications from applicants with strong credit profiles, leading to instant approval. 

Where manual approval is necessary, an application may require further review and take longer.  

“A manual decision requires a person to review the finance application because an automated decision couldn’t be made. This can occur if a client asks to borrow much more or less than the amount typically approved for a car of a specific value, or in the case of affordability constraints,” Zwane explains.

Pre-approval vs final approval timeframes 

Not all lenders offer pre-approval. Some may require your most up-to-date information or specific details regarding the vehicle you want to purchase, for example.  

Where they do offer pre-approvals, you’ll need to submit financial information so the lender can determine the loan amount you qualify for.  

Check if your potential lender has an online application tool. If you qualify, the automated process can provide quick finance approval.  

This will help you work out a budget and streamline the purchasing process, says Gaoaketse.  

What is pre-approval? 

Pre-approval is essentially a lender’s initial assessment of you as a potential client, based on your credit profile and basic financial information. It indicates whether you’re likely to qualify for a vehicle loan. 

“Obtaining pre-approval involves submitting your financial information to determine the loan amount you qualify for,” says Gaoaketse. 

It’s important to understand that pre-approval isn’t a final loan offer. Instead, it’s a way to know how much you can afford, and it shows a lender you’re a serious buyer ready to purchase.  

If your finances have already been reviewed, the final loan process can be quicker, provided nothing has changed since you applied. 

Timeframe for getting pre-approved 

The timeline for vehicle loan pre-approval is usually relatively short, especially if your documents are in order. 

You could know within 10 minutes whether you’ve been pre-approved, says Gaoaketse. 

Transitioning from pre-approval to final approval 

Once you’ve selected a vehicle, submit the details to your lender so they can finalise the loan offer. 

“The transition time can vary, but it’s generally a few hours if all your information is in order,” Gaoaketse points out.  

How easy is it to get vehicle finance?  

Most South Africans can’t afford to pay cash for a car, which is why you’ll usually need vehicle finance – although getting approved isn’t necessarily automatic. Challenges you may face could include having a low or irregular income, a poor credit score, too much existing debt, missing documents, or no deposit. 

The good news? Many lenders offer flexible options and are willing to help, especially if you have worked to improve your credit score, and have the right paperwork ready. 

With a bit of preparation, getting car finance should be within your reach, provided you meet the affordability requirements and have a decent credit score. 

Register now to check your credit score with JustMoney.  

The main players in vehicle finance  

The table below lists South Africa’s main vehicle finance providers, along with key features that can help guide your decision when choosing a lender. 

How does vehicle finance work?

Vehicle finance allows you to buy a car without paying the full amount upfront. Your lender pays the dealer on your behalf, and you repay the finance provider in monthly instalments over an agreed period, typically between 12 and 72 months, although it’s sometimes possible to negotiate longer loan periods. 

Are there differences between financing new and used vehicles? 

No, there are no significant differences, although loans for second-hand vehicles tend to have shorter repayment periods.  

The process for applying for finance is the same.  

Gaoaketse notes the following distinctions: 

New vehicles

• Typically have manufacturer warranties
• Have a higher purchase price but potentially lower initial maintenance costs 

Used vehicles

• Have a lower purchase price
• May have higher maintenance costs and limited or no warranties 

Lenders will provide financing options for both new and used vehicles, considering their condition and value.  

Different financing options 

Various financing options may be available to you. These include: 

• Instalment sale agreements. You pay off the vehicle over a set period, and ownership transfers to you after the final payment.
• Lease agreements. You lease the vehicle for a period, with an option to purchase at the end.
• Balloon payment options. You pay lower monthly payments, but there’s a lump sum due at the end of the term.  It’s important to make sure you’ll be able to pay this outstanding amount at the end of the initial repayment period.
• Guaranteed future value (GFV). A GFV finance plan calculates the future resale value of a vehicle at the end of the contract – provided you meet specific conditions, like mileage limits and regular service. At the end of the term, you can trade in the car, return the car with no further payment (if it meets the agreed mileage and conditions) or buy the car by paying the GFV (a balloon payment) if you want to keep it.  

Initial steps before applying 

Here are some steps to follow before you apply for vehicle finance, to improve your chances of approval and potentially secure better loan terms.  

1. Check your credit score. Your score has a significant impact on whether your application is approved, and the interest rate you’ll be offered. “Maintaining a good credit record is essential as it affects both your approval chances and the loan terms,” notes Gaoaketse.
   
   
2. Choose the right vehicle. When deciding between new and used cars, consider factors such as warranty, mileage, condition, and depreciation. “New cars typically have manufacturer warranties, while used cars may offer better value but need careful inspection,” Gaoaketse points out. Zwane recommends you choose the vehicle best suited to your needs. “Don’t buy the first vehicle you see – take your time, do your homework, and ask questions. If it’s a second-hand car, enquire about its service and accident history,” he recommends.
   
   
3. Calculate whether you can afford the vehicle you’ve got your eye on. Work out how much you can realistically afford to pay every month, including for car insurance, fuel, maintenance, and possible repairs. “WesBank recommends allocating between half and two-thirds of your budget to the vehicle instalment, with the remainder covering additional costs, such as insurance, maintenance, and fuel,” says Gaoaketse.
   
   
4. Calculate your deposit. If you don’t have a vehicle to trade in, your lender may require a deposit of around 10% to 30% of the value, though some lenders may offer 100% vehicle finance.
   
   
5. Compare your finance options. Lenders have online tools that allow you to compare various finance options and understand what you can afford. Many also have guides to vehicle finance that provide insight into various financing structures and what to expect during the application process. 

What lenders look for in an application 

Gaoaketse says the following factors will be assessed: 

• Your credit history. A strong credit history indicates you’ll be reliable regarding debt repayments.
• Your income. Proof of consistent income assures lenders you’ll be able to make your monthly repayments.
• Your debt-to-income ratio. Lenders review your existing debt relative to your income to ensure you can afford to take on additional credit. A low debt-to-income ratio is a significant advantage.
• Deposit availability. Having a deposit can reduce the loan amount and show financial responsibility. 

Lenders are most interested in your credit score and affordability, Zwane notes.  

“A lender will calculate your discretionary income – your take-home pay minus living expenses and existing debt repayments – to determine if you can afford the new vehicle repayments,” he says. 

“High debt levels will impact the lending decision, so make sure you’re not overindebted.”

Documentation required 

Both MFC and WesBank, for example, require the following documents from vehicle finance applicants: 

• A valid South African ID or passport
• A valid South African driving licence
• Proof of residence, for example a recent utility bill 
• Proof of income, including three months’ payslips
• A breakdown of your monthly household expenses 
• Three months’ worth of personal bank statements
• Details regarding the vehicle you intend to purchase

These documents help verify your identity and financial status, and the specifics of the vehicle you’re financing.  

How to improve your chance of approval 

Boosting your chances of vehicle loan approval is all about proving to lenders that you’re a reliable, low-risk borrower, says Zwane.  

Here are some practical tips: 

• Maintain a good credit score. Pay your bills on time and manage your debts responsibly.  
• Save for a deposit. Having a down payment available can reduce the loan amount and show you’re financially committed.
• Ensure you have a stable income. Consistent employment and income reassure lenders of your repayment ability.
• Settle existing debts, where possible. Reducing your liabilities will improve your debt-to-income ratio.
• Obtain pre-approval, if you can. This shows that you’re a serious buyer who is financially prepared to make the purchase. Some lenders may offer you special loan options based on your profile. 

Guidelines for borrowers 

Here are some tips to help you make a considered decision before applying for vehicle finance.  

• Consider whether you should choose a fixed or variable interest rate on your car loan. A fixed interest rate keeps your monthly repayments constant, which helps with budgeting. A variable rate goes up or down with the prime lending rate, so you save if rates drop, but pay more if they rise. Choose the option that best suits your needs and financial situation. 
• Understand the impact of your deposit on your loan term. The bigger your deposit, the less you’ll need to borrow. This means lower monthly repayments and overall interest. Even a small upfront payment can improve your loan terms and make your finances more manageable.
• Compare total costs, not just monthly repayments. A low monthly payment may seem like a win, but if it stretches your loan over a longer period, you will pay more in total. Always look at the full cost of the loan.
• Factor in insurance and maintenance. Owning a car comes with extra costs, such as insurance, fuel, maintenance, and repairs. These can add up quickly, especially with second-hand vehicles.
• Insurance is mandatory. You won’t be granted a vehicle loan unless the car is insured. Requirements differ between insurance companies, but all will require a valid South African driving licence in your name. Lenders check periodically to ensure the insurance is still in place after purchase, so don’t cancel once you’ve driven off the showroom floor.
• Be careful with balloon payments. Negotiating a balloon payment will lower your monthly instalments, but you will need to pay a large lump sum at the end of your loan term. If you don’t plan and budget for this cost, you may end up having to refinance your car loan, which would mean you pay more in the long run. Only choose the balloon-payment option if you understand the risks and are sure you’ll be able to cover the final payment.
• Check for early settlement penalties. Want to pay off your car loan early? Some lenders charge a penalty for that, so make sure you understand the rules before signing. 

Tip: JustMoney’s vehicle finance calculator helps you determine what vehicle you can afford.