Getting Cash for your Car: What are the Options?

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Getting Cash for your Car: What are the Options?

Post by kingr »

A fully paid-up car or truck is a valuable asset – and selling it isn’t the only option if you need funds. In South Africa, there are several ways to get cash for your car, quickly and safely.

These alternatives can be invaluable when you need fast access to cash. However, each has pros, cons and certain costs that you should be aware of before entering into an agreement.

Pawn and drive your car
Pawn and drive schemes are a popular option for generating funds, in the form of a short-term loan for your car.

Pros of pawn and drive schemes
The idea sounds great – you get a cash loan against your car, and you’re still able to drive your car during the loan period.

However, the devil is in the details.

Disadvantages of pawn and drive schemes
Often, pawn and drive schemes involve actually transferring ownership of your vehicle to the service provider. You then pay the provider a rental fee to continue driving it.

Essentially, you have to rent back your own car!

This also makes you more vulnerable to losing your car altogether to an unscrupulous lender.

A final disadvantage is that interest rates on pawn and drive loans tend to be pretty high.

A number of pawn and drive companies have found themselves in hot water with the National Credit Regulator (NCR) for unethical business practices, including charging exorbitant loan fees.

The end result is that a pawn and drive scheme can be much more expensive than simply selling your vehicle, or even pawning your car and renting another vehicle until you’ve paid off the pawn loan.

Pawn your car

Well-established car pawn companies, such as Pawn My Car, offer asset-based loans against fully paid up vehicles.

Advantages of pawning your car for cash
Asset-based loans against cars are much more straightforward than pawn and drive schemes. You simply offer up your car as collateral, or security, for a loan.

The loan amount that’s offered will be calculated based on the appraised value of your car. This will depend, for example, on its make, model, age and overall condition.

If you choose to enter into an agreement, the cash for your car is usually paid into your account very quickly – even on the day you apply for the loan, in some cases.

You don’t lose ownership of the car as part of the loan agreement. Instead, it’s stored as security against the loan. Once you’ve repaid the loan and agreed on interest, the car is returned to you.

Provided your loan provider is accredited by the NCR, pawning your car can be an effective way of generating finance quickly. This is useful if you’re experiencing short-term cash flow issues.

Potential disadvantages of pawning your car
Pawning your car is not the best way to get cash for your car if you’re not expecting your financial situation to improve. As for any kind of loan, be certain that you can meet the terms of an agreement before signing.

Also, be careful to avoid unscrupulous lenders. If anything seems “off” with a loan provider’s website or manner, on the phone or in person, trust your instincts.

It’s best to opt for a pawn company that’s well-established, with multiple physical branches.

Also, make certain that all terms are clear. Opportunistic lenders may charge hefty administration fees, fees for storing your vehicle and penalties for early loan repayment. Others offer terms that are more transparent and fair.

Cars for cash
Cars for cash schemes let you sell a vehicle fast, for a cash lump sum.

Advantages of cars for cash services
A car for cash arrangement will typically generate a larger amount of cash for your car than a pawn deal. Of course, though, it means permanently parting with your vehicle.

Getting cash for your car is an attractive option if you need funds fast.

It’s also an option if you have an older or accident-damaged vehicle that wouldn’t be accepted as collateral in a car pawn deal.

Disadvantages of cars for cash services
A fast-tracked car sale is a “pressure” sale. Typically, you’ll settle for a payout that’s significantly lower than you’ll achieve if you sell your car privately on the used car market.

To ensure you don’t accept offers that are too low, it’s best to start by getting a professional, unbiased valuation of your car.

Once you have that information, approach several different dealers. Shop around for the most competitive offer.

Get an accurate valuation of your vehicle now
Before entering any transactions that involve getting cash for your car, it’s good to have an accurate idea of its market value. Wheel Index’s Car Book Value tool makes it quick and easy to get the book, trade and retail value of your vehicle online.

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Last edited by kingr on Fri Jun 14, 2019 10:23 am, edited 1 time in total.
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Re: Getting Cash for your Car: What are the Options?

Post by MR.C »

This might also be an option: ... 4AEALw_wcB

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