Pawn My Car makes it easy to secure the best car pawn rates in Cape Town, with headquarters on Strand Street and operations across the Mother City and its suburbs.

In this article, we take a look at what kind of rates you can expect when pawning a car:

• Are car pawn rates higher than bank interest rates?
• What questions to ask lenders about their car pawn rates
• Beware of unregistered pawnbrokers
• What are the best car pawn rates in Cape Town?
• The best car pawn agreements in Cape Town with Pawn My Car

Are car pawn rates higher than bank interest rates?

Ultimately, yes. Interest rates are higher than traditional banks. However, pawn agreements offer specific benefits that banks can’t compete with.

Pawn agreements are fast and easy to complete. Because the loan amount is based on a physical asset, all you need is a paid off car in your name.

Pawn agreements also don’t have any effect on your credit score. To pawn a car, you don’t need to be employed or provide any payslips.

This makes pawn agreements popular with people who have assets but don’t necessarily have a traditional income.

What questions to ask lenders about their car pawn rates

Asking a few pertinent questions before taking out a loan is good practice no matter what institution you are dealing with.

If you are concerned about extra charges or high interest rates, ask these questions to get a clearer picture.

What interest rate do you charge?

Find out what their interest rate is up front. This way you know the full amount, including interest, that you will need to pay back.

What are your fees and charges?

Ask the lender what fees and charges to expect. Hidden fees can inflate the total cost of the loan, so be sure the lender is upfront about their fees.

Are there any penalties to be aware of?

Ask if there are any penalties for early cancellations or late payments. Dubious lenders will try to hide these kinds of penalties.

Is insurance included?

Find out if insurance for the loan amount and insurance for your vehicle while in storage are included in the repayment amount.

Are you registered with the NCR?

Ask the lender if they are registered with the National Credit Regulator. This will ensure their fees and interest rates adhere to national credit regulations.

Warning: not all pawnbrokers are registered

Under South African law, only pawnbrokers over a certain size need to be registered. This is usually lenders with 100 agreements on their books or a total outstanding debt of more than R500 000 owed to them.

However, even amongst lenders that meet or exceed this requirement there are plenty who are not registered and will try to pass themselves off as legitimate.

Be wary of these unregulated lenders and only deal with pawnbrokers that can prove they are registered with the NCR.

What are the best car pawn rates in Cape Town?

Pawning is like any other form of credit, so the car pawn rates in Cape Town will fluctuate in line with the national rates.

The best rates will fall at or under the prescribed limits set by relevant National Credit Act (NCA) provisions, which are monitored by the NCR.

Typically, you can expect the Cape Town rate to range from 36% to 60% APR, with terms from 3 to 24 months.

Pawn My Car, for the best car pawn agreements in Cape Town

Pawn My Car is a division of an NCR-registered, financial services provider. We have offices in Cape Town and most other major South African cities.

At Pawn My Car, you are guaranteed:

• NCR compliant interest rates
• No hidden fees or charges
• No late settlement penalties
• A fast and simple applications process
• Discreet lending with no credit rating interference
• Ten years of experience in asset-based lending

Apply online now to get a loan against your paid off vehicle. You can also contact us via Whatsapp to find out more about the best car pawn rates in Cape Town.

Complete an application now