Repossessed Cars In South Africa - When And How It Can Happen
Car repossession in South Africa is not a foreign term, but the financial climate of the country has changed dramatically over the last 2 years due to the Covid-19 pandemic, and repossessed cars are becoming more of an occurrence. But when do cars get repossessed, how can it happen and how can it be avoided? Here is a run through of the process of repossessed cars in South Africa.
When Does A Car Get Repossessed?
The process that rendered cars repossessed in South Africa is ultimately a series of steps. Repossession starts with an initial letter of demand after the first missed finance installment on a car. This is usually sent 20 days after the payment deadline has been missed and generally states a timeframe for the outstanding funds to be paid. If the owner fails to make the payment within the given timeframe, a summons is issued. This means that the case of missed payments can be taken to court. Here is when the court determines whether repossession is necessary. If so, an order will be granted, allowing repossession to take place.
How Does It Play Out?
Once a car has been repossessed in South Africa, it falls under the responsibility of a creditor who will send it to an auction house to be sold in order to cover the outstanding amount owed by the initial owner. If the repossessed car can only be sold for an amount that is less than the outstanding amount owed, the initial owner will need to pay the rest to the creditor. However, if the car is sold for more than what is owed, the excess is given to the initial owner.
It is important to note that if your car is repossessed, you will have to pay the creditor legal fees. It is likely that creditors will offer some leeway before officially repossessing the car, giving the initial owner an opportunity to make up the outstanding amount. This is usually until legal action has been issued. Overall, it is suggested that when faced with repossession that you avoid reaching the point where legal action is required.
These are the initial ins and outs of repossessed cars in South Africa, ultimately resulting in auction cars. South Africa is likely to see more and more repossessed cars on auction as we move forward from the Covid-19 pandemic. To learn more about repossessed cars in South Africa, get in touch with a Motus Auto Auctions consultant.