Who can apply for credit?
Everyone has a right to apply for the rent to buy. This does not mean that the credit provider has to grant it: it first has to assess your credit rating. It may turn down your credit application on a number of grounds, such as lack of affordability and prior judgments. If your credit application is declined, you have the right to request the reasons. If the application was declined on the basis of an adverse report from a credit bureau, you have the right to be advised of this and to receive the credit bureau details. You have a right under the NCA to take the listing up with the credit bureau, to challenge the listing and to have erroneous entries corrected.
| Type of Person Applying for Finance | Does the NCA Apply |
| Individual (the consumer) | Yes, unless the person is entering into a true rental agreement |
| Sole proprietor (self-employed person) | Yes, unless the person is entering into a true rental agreement |
| A trust with less than 3 trustees | Yes, unless one of the trustees is itself a juristic person, in which case it must be dealt with in the same vein as a trust with 3 or more trustees |
| A trust with less than 3 trustees with an asset value or annual turnover of less than R1 000 000 | Yes, unless the trust is entering into a large agreement. Certain of the provisions of the NCA do not apply to juristic persons. |
| Small juristic person (annual turnover or asset value of less than R1 000 000) | Yes, unless the trust is entering into a large agreement or a true rental agreement. (Note that certain of the provisions of the act do not apply to juristic persons.) |
| Large juristic person | No |
| Government | No |
" What about insurance?"
The NCA allows credit providers to insist that the consumer must, as an absolute minimum, have credit insurance. This is insurance that protects the debt in the event of the motor vehicle being lost, damaged or stolen. The insurance is limited to the amount outstanding under the credit agreement as it is from time to time. Consumers are strongly advised to consider maintaining their own comprehensive insurance as an alternative, as this is linked to the market value of the asset. Credit providers may also insist on the consumer having credit life insurance. This is insurance that protects the debt in the event of the consumer’s death, disability or
"What if my application for rent to buy is is refused?"
In this case you have a right to request the reasons for the declination. Cars World will provide reasons upon your request to enable you to correct the problem.Cars World approval rate is over 90%.
"Can I apply without a driver’s license?"
You can only buy a vehicle if you have a valid South African driver’s license. It is illegal and very risky to drive without a valid license. Any insurance you thought you had will also be invalid – the insurer will refuse to pay any claims because you were driving without a license.
"What interest rate will I be charged?"
The NCA specifies the maximum interest rate that you can be charged. Within this boundary, Cars World will determine the interest rate by assessing your credit rating and credit history (the status of your finances – how much debt you have).
"What other costs will I be liable for?"
Apart from the principle debt, you will be charged: An initiation or processing fee – a once-off fee or as part of the principle debt (whereupon interest will be charged) A service fee -as determined by your credit provider Costs of optional extras – for example, the cost of an extended warranty; delivery of the vehicle; extras like a radio and air-conditioning; your first tank of petrol; credit life or credit insurance premiums; default administration costs and collection charges; and interest.
"How much deposit must I pay?"
The NCA allows you to enter into a credit agreement without paying a deposit. To protect the consumer and its own risk, however, Cars World is guided by policies that allow them to ask for a deposit if your personal credit profile (i.e. the state of your personal finances) justifies this.The deposit ranges from 10%.
"When do I have to make my first payment to the credit provider?"
You may negotiate this with Cars World. Normally you would pay a deposit on signing the agreement. The next payment would be within 60 days of the signing of the agreement.
"Can I change my due date?"
(This is the date on which you must make a payment every month) Yes -you can call CarsWorld and ask for a date change. Your telephone call will be recorded and you will receive a copy of your request in writing within 20 business days.
"Will I own the vehicle at the end of the agreement?"
In the case of an instalment sale, YES - ownership passes to you automatically at the end of the agreement once you have paid all amounts you owe. In the case of a lease, YES - ownership passes to you if you pay the nominal amount and meet the other conditions set out in the lease agreement.
"Where can l service my vehicle?"
At franchised workshop as per manufacturer's specification.
"Who is responsible for the service and maintenance of the vehicle?"
The renter is responsible for service and maintenance at his/her own cost.
"Having more questions?"
Contact us today to find out more,or complete our application form and you can be driving off in your own car before you know it.
