The amount you can borrow against a car in South Africa will depend on the car – and the lender you choose.

Loan offers are usually calculated as a percentage of market resale value (often 40% to 50%). However, a range of other factors can impact the cost of a loan.

How much you can borrow against a vehicle

The loan amount is dependent on the market value of the vehicle.

Pawn My Car has facilitated loans ranging from R20,000 to R10 million against a wide variety of vehicles – motorbikes, panel vans, cars, yachts and planes.

Charges and fees to consider when choosing a lender

The interest on a loan is not always the only cost of borrowing.

Some lenders charge admin fees, exit fees and fees to cover the cost of the vehicle appraisal or credit report.

Early-settlement penalties may be imposed for repaying the funds prior to the end of the agreed loan term.

In these cases, fee structures are typically opaque. This can make it difficult to ascertain the full cost of borrowing against a car.

Pawn My Car does not apply hidden fees or penalties.

Our fee structure is transparent and all costs associated with the loan are outlined in the loan agreement and reflected in the APR (annual percentage rate).

Why avoid ‘pawn-and-still-drive-it’ loan providers

By and large, pawn-and-still-drive-it loan providers are best known for fleecing their customers.

In an effort to circumvent the regulatory clout of the National Credit Regulator, they have come up with an audacious scheme.

As reported in the Daily Maverick, the pawn-and-still-drive-it lender ostensibly buys the vehicle, charges you a monthly fee to continue driving it, and then sells the car back to you at an inflated price.

If you can’t afford to buy back the car or fail to meet the monthly payments, the vehicle is taken, often by force, and sold.

What will affect the loan offer for your car?

When arriving at a fair loan offer, our vehicle appraisal experts consider the following:

• make and model
• mileage
• age
• condition
• current market demand.

A good condition, later-model vehicle with a low mileage will realise a higher loan amount than an older car.

Similarly, if you own a popular make of car with high sales volumes on the second-hand market, you’ll be able to borrow more funds against it, more easily.

How to get a loan offer for your car

With Pawn My Car, you can use a car, bakkie, truck or boat that’s in your name to secure a competitive loan quickly and easily, with no delays or laborious paperwork. For more information about how much you can borrow against a car, contact us on 0861 112 866 (or send us a WhatsApp) – or simply complete and submit our online application form.

Complete an application now