Private car purchase - Finance issues

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nevadayz

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Hi Guys,


I've been trying to get finance for a privately owned car, its a 2009 Audi, and going for 345k.

I'm currently a private banking client at Std Bank and they have told me that they don't offer residual(which is what i need to get the car) on cars older than 1 year.

So, can i fight them against this, or any other options for me to try?

I have already tried WesBank and MFC, both either dont do private sales, or don't offer residuals on 2nd hand cars.

Thanks!
 
nevadayz said:
Hi Guys,


I've been trying to get finance for a privately owned car, its a 2009 Audi, and going for 345k.

I'm currently a private banking client at Std Bank and they have told me that they don't offer residual(which is what i need to get the car) on cars older than 1 year.

So, can i fight them against this, or any other options for me to try?

I have already tried WesBank and MFC, both either dont do private sales, or don't offer residuals on 2nd hand cars.

Thanks!
Click to expand...

I've never financed a car with a residual, so I am not too sure. I've had two cars privately financed, one through Wesbank and now he current one through MFC (Nedbank). They certainly do private finance but I only can't advise on residual payment plans.
 
Makes sense. Why residual a car that is older than one year. The whole appeal to people with residual is that they can buy a brand new car.

I don't mean to pry, but why go for something you can't afford? Why not get something more affordable and leave the residual. Would make better financial sense.
 
Wesbank will happily help you with private finance, but I am fully behind them not offering a residual on a second hand car - sorry, you would be crazy to do that.
 
Fazda said:
Wesbank will happily help you with private finance, but I am fully behind them not offering a residual on a second hand car - sorry, you would be crazy to do that.
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Yeah it seems a bit of an odd decision. People usually take out a residual because they want to drive a new car, and keep changing every x amount of years.

If you need to take out a residual on a second hand car, then you can't afford it and I doubt that many financing houses would be willing to take the risk.

Also, any maintenance plan would expire before the finance term is over, so effectively you'll soon be sitting with a car without a maintenance plan, and still be owing a crap load on it. Don't do it.
 
yep you should not be taking residual, live within your means.

but imo go to wesbank, then after that move your banking to FNB :p
 
Lol thanks guys, in terms of buying the car , I can afford it even with no residual , but I want the premiums as low as possible, I dont see the point overpaying for a car I will only keep for two years. I also totally agree with living within ur means. Thing is with cars, i really see no sense in paying and incomveniencing yourself for a deppreciating asset.
 
ok, so you're buy from person X not from a company & you want finance from the bank with residual. That means they'll sit with an amount(y) paid to X that you don't want to pay...

I can understand why they won't offer residual..
 
nevadayz said:
Lol thanks guys, in terms of buying the car , I can afford it even with no residual , but I want the premiums as low as possible, I dont see the point overpaying for a car I will only keep for two years. I also totally agree with living within ur means. Thing is with cars, i really see no sense in paying and incomveniencing yourself for a deppreciating asset.
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Sorry but that it just irresponsible, you want to pay as little as possible, drive the car for 2 years and then trade the car with a huge debt?
 
nevadayz said:
Lol thanks guys, in terms of buying the car , I can afford it even with no residual , but I want the premiums as low as possible, I dont see the point overpaying for a car I will only keep for two years. I also totally agree with living within ur means. Thing is with cars, i really see no sense in paying and incomveniencing yourself for a deppreciating asset.
Click to expand...

Think this one through slowly....if you borrow X amount from the bank, you are going to have to pay it off at some point, like it or not. Buying on residual, just because you want lower instalments is a no brainer, I'm afraid. Where do you think the money that you are "saving" every month goes to?

The bank is still going to want their money back in the end, and guess who is going to have to cough it up, when the time comes!!

If you can afford a car (i.e. an instalment that is about 15% of your gross income) then buy it that way. A residual is just going to pop up and bite you in the bum in 3 years time, or whenever you want to get rid of the Audi.

All that being said - certain Audis do not trade well, and you could find yourself "married" to the car for a long, long time.
 
Fazda said:
Think this one through slowly....if you borrow X amount from the bank, you are going to have to pay it off at some point, like it or not. Buying on residual, just because you want lower instalments is a no brainer, I'm afraid. Where do you think the money that you are "saving" every month goes to?

The bank is still going to want their money back in the end, and guess who is going to have to cough it up, when the time comes!!

If you can afford a car (i.e. an instalment that is about 15% of your gross income) then buy it that way. A residual is just going to pop up and bite you in the bum in 3 years time, or whenever you want to get rid of the Audi.

All that being said - certain Audis do not trade well, and you could find yourself "married" to the car for a long, long time.
Click to expand...

Fazda says it way better +1
 
ChilliGirl said:
ok, so you're buy from person X not from a company & you want finance from the bank with residual. That means they'll sit with an amount(y) paid to X that you don't want to pay...

I can understand why they won't offer residual..
Click to expand...

Chilligirl, trust me, if the bank doesn't offer you a residual, it is for a very good reason - too many repossessions started off on a "small" residual, which very soon ended up as a millstone around the buyer's neck.
 
You essentially going to be paying nothing but interest for 2 years on a residual.
You'll find yourself owing the bank about R350k on the car and the value would be R250k.
So even if you manage to sell it,youre still going to cough up from your own pocket to settle it.
 
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