SPONSORED: Is it time to trade in that old jalopy for something a bit more suited to your current lifestyle?
Whether out of necessity or because you are due for an upgrade – few of us are able to afford a new car without some form of vehicle finance.
Absa offers two types of financing options:
- Instalment Sale Agreement
- Islamic Vehicle Finance
Each one of these plans are tailored for specific types of consumers, allowing for greater choice and versatility when looking for finance options.
Instalment Sale Agreement
This is a great option that provides you with the flexibility of choosing a repayment period of a minimum of 12 months up to 72 months. Once you have settled the full outstanding balance owing on the finance account, you will become the owner and titleholder of the car. The option also provides you with an opportunity of taking on a residual value of up to 40% (risk profile dependent), otherwise known as a balloon payment. A balloon payment allows a customer to pay lower monthly instalments throughout the contract term however it requires the payment of the entire balloon amount as your last instalment when the contract term has reached its end. The balloon payment will attract interest over the term of the contract. Any extension of the Balloon payment at the end of the term, will result in additional interest being charged for the extended period of the contract.
The added benefit of an instalment sale agreement is that you can pay a lump sum as a deposit upfront or during the term of the agreement, which can help to decrease the monthly instalment. If you pay in a lump sum during the term of the agreement, you can choose to allocate this payment to your capital to reduce your monthly instalment, or allocate it towards your balloon payment. You will need to notify your bank of your intended allocation for the lump sum payment.
Fixed or variable interest rates are available with a range of benefits. This depends on an assessment of your credit risk profile.
Absa Islamic Vehicle and Asset Finance (Ijaarah Lease Agreement) is specially designed for consumers who prefer to finance a car or asset in a Shari’ah compliant manner.
The Ijaarah Lease Agreement allows you to lease the asset from Absa by paying regular lease payments over an agreed period.
This option has the following benefits:
- Ownership will transfer to you once you purchase the car or asset as per an “Undertaking to Purchase”.
- Payment periods will be structured to suit your requirements and your credit risk profile.
You can apply for the product at:
- Absa branches,
- Dealers who are approved to transact with Absa Vehicle and Asset Finance
- Contact Centre, 0860 669 669 or via the Absa website: www.absa.co.za