Guiding consumers since 2009

Calculate your vehicle finance instalments

By Isabelle Coetzee

You’ve dreamed of a set of wheels since you can remember, and now that you’re a responsible adult with a steady income, you’re ready to take on funding to make this dream a reality.

But what kind of vehicle finance options are available to you? Justmoney gives you the rundown.

Tip: To get an obligation-free quote for vehicle finance, click here.

Click on the following banks to go directly to their vehicle finance calculators. Here you’ll be able to see how much you would owe each month based on your income and expenses:

If you would like a second opinion, calculate your vehicle finance options through Justmoney.

What are your financing options?

When applying for vehicle finance, you will have a choice of three kinds of payment plans. Each of these has unique benefits are best suited for certain consumers.

The first plan is known as instalment finance (or hire purchase). This is when you put down a deposit and pay monthly instalments to settle the remaining amount.

The second option is called instalment finance with a balloon payment. This is when the deposit, or “balloon payment”, is paid at the end of the instalment period rather than at the beginning.

And finally, you can pay off your vehicle based on guaranteed future value. This means that the future value of the car is determined and that once that’s paid off, you return the car to the bank.

READ MORE: 3 Vehicle financing options compared – which is cheaper?

This is what you should consider beforehand

According to Mohammed Sadar, new business development executive of auction.co.za, you should consider the following before taking out vehicle finance:

  • Know your budget: This goes without saying, but you need to know what you can afford before hitting up sites like www.auction.co.za to get that flashy convertible or hulking off-roader. The perfect car is ultimately the one that doesn’t break the bank or leave you with crippling debt.
  • Credit history: It is always good to try and ensure that you have some other form of credit. This can be as simple as a clothing store account or as complex as a bond. Whatever the credit, you must pay it off on time to build a good history. Banks want to determine whether you are creditworthy. Having active credit will act as proof.
  • Shop around: All cars listed must undergo a strict vetting process so you can buy with a certain level of comfort. Browse around and compare so that you make an informed choice. After all, your car must last you for some time, so it is no use making a decision under pressure.

Sadar explains that you must consider the interest rate you are being offered, as well as any additional fees hidden in the small print.

“Also think about the repayment period. Even though four- or five-year plans are common, you might be able to work out a special arrangement with the financial services provider depending on your needs,” says Sadar.

“If possible, it would be great if you can put down a cash deposit of 10% of the purchase price. This will not only significantly reduce the cost of the loan but will also show the bank you are invested in getting it paid off quicker,” he adds.

If you’re ready to take out vehicle finance today, fill in this form to get an obligation-free quote.

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