If you are blacklisted and need a car, you should thoroughly consider all of your options before buying such an expensive asset that could put you in debt for a very long time.
You need to remember that economic times are tough and a car is a depreciating asset, meaning its value decreases over time, if you find your eye wandering over to the shinier models.
Motorists are ever more opting for preowned cars over new car loans these days. The price of new cars has skyrocketed, as the weaker rand has inflated the price of imported cars. Whereas the price of preowned cars remains well below inflation.
If you need a car, you could save a lot of money by opting for a preowned car, instead of taking out a new car loan. Not only will you get it at a much lower price, but with higher specifications too. Moreover, it won’t even matter whether or not you are blacklisted.
If you have been blacklisted or have a poor credit record, reputable credit providers are unlikely to grant you a loan for a new car. Those who do approve you for new car finance are probably predatory lenders, who will charge you exorbitant rates and fees.
You also need to consider the cost of upkeep, which includes insurance, petrol and other running expenses. With new car finance, you have to make expensive repayments every month on top of all of these costs.
The average car loan has a repayment term of 69 months – that’s 6 years of paying off car debt!
As follows, you will owe more on the new car, than it’s actually worth in the first 4 years of driving it. So, if you find yourself in financial trouble during these initial years, you won’t be able to sell the new car in order to settle the loan.
Subsequently, if you cannot afford your car repayments any more, you will be blacklisted and at risk of losing your car.
If you need a car, it makes more sense to save up and buy a preowned car that you can actually afford. Than to pay a lot more money over a much longer period of time, as well as risk becoming blacklisted or even losing the car.
Most people replace their car after 36 months. So, if you decide you need an upgrade after 3 years, you will end up spending a lot more on the car in the long run, than it is actually worth
You need to ask yourself whether or not you really need a car at this point in time, as you could save a lot of money by simply making use of public transport. If you are blacklisted or caught up in an endless cycle of car debt, contact NDA today for help becoming debt free.