Charl Potgieter, Head of Personal Markets at Absa, advised consumers to consider the full cost of vehicle ownership and always build in a buffer to cater for the fluctuations.

Potgieter said consumers purchasing used or second-hand vehicles, often out of motor plans, must consider the benefit of obtaining extended motor plans.

“If you (consumer) do not have a motor plan and the vehicle experiences an expensive mechanical fault, you will need to fund this from your own cash resources. You still need to honour your monthly vehicle instalment with the bank if your vehicle is faulty or non-operational.”

This, Potgieter said, could minimise the anguish of having to part with their vehicle if they find themselves battling or unable to pay the instalments.

Potgieter pointed out it was vital for consumers to be aware that not paying their instalments was a breach of contract and might eventually lead to the repossession of their vehicle.

“So it is important to make sure that you find a way to avoid this before it happens,” the expert said.

Potgieter said consumers were faced with increasing costs impacting their net disposable income and did not account for fuel, maintenance and even interest rate increases.

“This means that what was initially affordable for the consumer, has now become unaffordable.”

Potgieter’s tips to consumers include cutting out non-essential monthly expenses, trading in for a more affordable vehicle or refinancing their vehicle.
– CAJ News