Blog
Can I Pawn A Car That Is Still Under Finance?
Still paying off your car but need access to extra cash? You might be wondering whether you can pawn a car to get a loan while you still owe money to the bank. The answer isn’t always as straightforward as simply saying yes or no.
If your car is still under finance, the outstanding amount needs to be taken into account. The good news is that having vehicle finance doesn’t necessarily mean you’re out of options. Pawn and Drive can assist with settling outstanding vehicle finance in applicable cases, subject to an assessment of your vehicle and the terms of the agreement.
Key takeaways
- You may still have options: Having outstanding vehicle finance doesn’t automatically mean you can’t explore a pawn-and-drive solution.
- Your outstanding balance matters: The amount you still owe your finance provider needs to be considered alongside your vehicle’s value.
- Pawn and Drive can assist: In applicable cases, Pawn and Drive can help settle outstanding vehicle finance.
- Every vehicle is assessed individually: The available arrangement depends on factors such as your vehicle’s value, outstanding finance, and the agreed terms.
Can You Pawn a Car That You Are Still Paying Off?
If you’re still making monthly payments on your car, the vehicle is tied to your existing finance agreement. This means you can’t simply treat it in the same way as a car that has been fully paid off.
The amount you still owe matters, as does the current value of your vehicle.
For example, you may have bought your car for R200,000 several years ago and have already paid a substantial amount towards it. Your car could now be worth R150,000, while you still have an outstanding amount with your finance provider.
This is where things can become more complicated than simply looking at what your car is worth.
Before making any assumptions, the vehicle and outstanding finance need to be assessed to determine what options may be available.
What If I Still Owe Money on My Car?
You don’t necessarily have to wait until your car finance is completely paid off before exploring your options.
Pawn and Drive states that it can assist with settling outstanding vehicle finance in applicable cases. This can be particularly useful if you have a vehicle with value but still have an amount owing to your finance provider.
Pawn and Drive’s website specifically mentions assistance with outstanding finance from providers including WesBank, ABSA, MFC and Standard Bank.
The important thing to remember is that this isn’t a one-size-fits-all process. Your vehicle, its value and the amount still owing all need to be considered.
How Does It Work If My Car Is Still Under Finance?
The first step is to understand your current position.
Pawn and Drive can assess your vehicle and consider the outstanding finance as part of the process. Where applicable, assistance can be provided with settling the amount owed to your existing finance provider.
From there, the available arrangement will depend on the vehicle and the terms agreed with Pawn and Drive.
In simple terms, the process involves:
- Your vehicle is assessed to determine its current value.
- Your outstanding finance is considered alongside the vehicle’s value.
- Your options are discussed based on your individual circumstances.
- Outstanding finance may be settled where applicable.
- Your Pawn and Drive agreement is put in place according to the agreed terms.
It’s important not to assume that every financed vehicle will qualify or that you’ll receive a particular amount. The figures need to be worked out based on your individual situation.
An Example of a Car With Outstanding Finance
Let’s say your vehicle is worth R100,000, but you still have a R30,000 balloon payment outstanding on your vehicle finance.
You may assume that because you still owe the bank money, you can’t use your vehicle to access cash.
Pawn and Drive explains that it can assist with settling the outstanding R30,000 owed to the bank in applicable cases.
What happens after that depends on the vehicle’s valuation, the outstanding amount and the terms of the agreement.
This is why it’s worth speaking to Pawn and Drive rather than assuming that your existing finance automatically rules you out.
What Happens Once Your Existing Car Finance Is Settled?
If there is still an amount owing on your vehicle, that outstanding obligation needs to be dealt with as part of the arrangement.
Once the existing finance has been addressed, the next steps depend on the agreement you enter into with Pawn and Drive.
Before committing to anything, make sure you understand:
- How much you are borrowing
- What your monthly repayments will be
- How long the agreement runs
- What happens if you want to settle early
- What happens if you are unable to keep up with repayments
- Whether you can continue driving your vehicle
Understanding the agreement upfront means you know exactly what you’re committing to and there are fewer surprises later.
Can I Still Drive My Car?
One of the reasons people consider a pawn-and-drive solution is that they may need access to their vehicle just as much as they need access to cash.
Your car might be how you get to work, take your children to school, run your business or simply get through your everyday routine.
Pawn and Drive offers a pawn-and-drive option that allows eligible customers to continue using their vehicle while repaying the loan, subject to the terms of their agreement.
In other words, accessing cash doesn’t necessarily mean you have to give up your transport.
If continuing to drive your vehicle is important to you, make sure you understand the driving arrangements that apply to your specific agreement before signing.
What Do I Need to Pawn My Car?
The exact requirements depend on your circumstances, particularly if there is still outstanding finance on the vehicle.
You may need documentation such as:
- A valid South African ID
- Vehicle registration documents
- Proof of ownership
- Information about your existing vehicle finance
- The vehicle itself for assessment
Having these details available can help make the assessment process easier.
If you’re unsure whether your documents or vehicle meet the requirements, the best option is to speak to Pawn and Drive directly.
What If My Car Is Already Paid Off?
If you’ve already paid off your vehicle, things can be more straightforward because there is no outstanding vehicle finance to take into consideration.
A fully paid-off vehicle can be assessed for Pawn and Drive’s standard pawn-and-drive service, subject to the usual eligibility requirements.
Your car’s value, condition, and other relevant factors will determine what may be available to you.
And because Pawn and Drive offers a pawn-and-drive option, eligible customers can continue using their vehicle while repaying the loan.
Frequently Asked Questions
Can I pawn a car if I still owe more than it is worth?
This depends on the vehicle’s value, the amount still owed, and the arrangement available after assessment. It is worth discussing your situation with Pawn and Drive to see what options may be available.
Does my car need to be fully paid off before I apply?
Not necessarily. Pawn and Drive says it can assist with settling outstanding vehicle finance in applicable cases, so having an existing finance balance does not automatically rule you out.
Can I pawn a car with a balloon payment still owing?
Yes, this may be possible. Pawn and Drive gives the example of a vehicle worth R100,000 with a R30,000 balloon payment outstanding and explains that it can assist with settling the amount owed to the bank.
Will I need to settle my current car finance myself first?
Not necessarily. Where Pawn and Drive is able to assist with outstanding vehicle finance, the existing amount owed can be taken into consideration as part of the arrangement.
What happens if I want to settle my Pawn and Drive agreement early?
Pawn and Drive offers early settlement options. The applicable terms should be confirmed when entering into the agreement.
Still Paying Off Your Car? You May Still Have Options
Having outstanding finance on your vehicle doesn’t necessarily mean you have to wait until the final instalment before exploring ways to access cash.
If you have an unexpected expense, need to manage a temporary cash-flow gap or simply want to understand what your vehicle could help you access, Pawn and Drive can assess your situation and explain the options available to you.
Still paying off your car? Get in touch with Pawn and Drive to find out whether you could use your vehicle to access the cash you need while keeping your car on the road.