CONSUMER ADVICE | What to know before surrendering your car

Question:

I own a 2014 Toyota Hilux. Currently, I am experiencing financial problems. I am thinking of going on pension in 2021. By then I will be 61 years old. The car is left with a balloon payment which started in July last month. I would like to know the following:

1. Will it be a good idea to surrender the car?

2. What are the procedures to surrendering a car?

3. What consequences can I expect?

4. Are there any other alternative besides surrendering the car? –Norman Bele

Lebogang Gaoaketse, head of marketing and communications at WesBank answers:

1. The National Credit Act allows the customer to voluntarily surrender a vehicle to the bank. The vehicle will be sold on auction. It must be noted that should the customer take this route, he/she will be held liable for any outstanding amount owing on the vehicle. This amount includes all costs associated with the sale of the vehicle.

2. When surrendering a vehicle, our advice is for the customer to contact the bank and make arrangements for the vehicle to be collected. The bank will ask the customer to sign a document stating that he/she has voluntarily surrendered the vehicle to the bank.

3. The customer’s credit rating will be negatively affected and he/she will be liable for any outstanding amounts owing on the vehicle after the sale. It is advisable for the customer to contact the bank as soon as possible and enter into an arrangement with the bank to pay this amount off over time.

4. WesBank’s advice to the customer is to try to sell the car out of hand to a reputable agent for the settlement amount. Suggestions include “We Buy Cars” or similar agents.