Repossession On a Car in South Africa: Know Your Rights

Have you ever missed a payment on your car loan? If so, you might be at risk of repossession on a car. Repossession is when a creditor takes back your car because you failed to pay your debt. It can have serious consequences for your finances, your credit, and your well-being.

In this post, we will explain what repossession is, why it happens, and how it affects car owners in South Africa. We will also share some tips and options to help you avoid or stop car repossession.

Repossession on a car is not something that creditors can do without following a legal process. According to the National Credit Act, creditors must comply with certain steps and requirements before they can repossess your car. These include:

Sending you a notice of default: This is a letter that informs you that you are behind on your payments and gives you 10 days to remedy the situation.

Issuing a summons: This is a legal document that initiates a court action against you and demands that you pay your debt or appear in court to defend yourself.

Obtaining a court order: This is a judgment that grants the creditor the right to repossess your car if you do not pay your debt or reach an agreement with them.

Executing a warrant: This is an authorization that allows the creditor to seize your car from your premises or any other place where it is located.

The Constitutional Court has ruled that creditors must send the notice of default by registered mail to ensure that you receive it. If they fail to do so, they cannot repossess your car without your consent .

The Consequences of Car Repossession

Repossession on a car can have devastating effects on your life. Some of the negative impacts of car repossession are:

Losing your vehicle: This can make it harder for you to get to work, school, or other places. It can also affect your personal and professional relationships, as well as your self-esteem.

Owing the remaining balance: Even if the creditor sells your car, you might still owe the difference between the sale price and the amount you owe on your loan. This is called a deficiency balance, and it can be very high depending on the value of your car and the interest rate of your loan.

Paying legal fees: If the creditor sues you for the deficiency balance, you might have to pay for their legal costs as well as your own. This can add to your debt and make it harder for you to repay it.

Damaging your credit score: Repossession will show up on your credit report for up to seven years, and it will lower your credit score significantly. This can make it harder for you to get approved for loans, credit cards, or other forms of credit in the future. It can also affect your interest rates, insurance premiums, and employment opportunities.

Facing emotional stress: Repossession can cause a lot of anxiety, depression, anger, and shame. It can affect your mental health and well-being, as well as your relationships with your family and friends.

Here are some examples and testimonials from people who have experienced repossession on a car:

– “I lost my car to repossession last year, and it was the worst thing that ever happened to me. I had to take the bus to work every day, and it took me twice as long. I also had to pay the creditor R50,000 for the difference between what they sold my car for and what I owed them. I had to borrow money from my family and friends, and I felt like a failure.” – Sipho, 32, Durban

– “My car was repossessed two months ago, and I still can’t believe it. I loved my car, and I worked hard to pay for it. It was more than just a car, it was a part of me. I felt like I lost a part of myself when they took it away. I don’t know how I’m going to get another car, or how I’m going to rebuild my credit.” – Ntombi, 28, Johannesburg

The Alternatives to Repossession on a Car

If you are struggling to pay your car loan, or if you are facing repossession, you might think that you have no choice but to give up your car. However, there are some alternatives that you can consider to avoid or stop car repossession. These include:

Negotiating a payment plan: You can contact your creditor and try to arrange a payment plan that suits your budget and situation. You can ask for a lower interest rate, a longer repayment term, a grace period, or a reduced balance. You can also offer to pay a lump sum or make extra payments to catch up on your arrears. If you can reach an agreement with your creditor, make sure to get it in writing and stick to it.

Applying for debt review: You can apply for debt review, which is a process that allows you to restructure your debt under the supervision of a debt counsellor. The debt counsellor will assess your income and expenses, and negotiate with your creditors on your behalf. They will propose a new repayment plan that is affordable and realistic for you. If your creditors accept the proposal, the court will issue a court order that protects you from legal action and repossession. You will then pay a single monthly instalment to the debt counsellor, who will distribute it to your creditors. You will also receive financial education and support from the debt counsellor throughout the process.

Selling your car: You can sell your car and use the proceeds to pay off your debt or settle with your creditor. This can help you avoid repossession and legal fees, and save your credit score. However, you will need to find a buyer who is willing to pay enough for your car to cover your debt, and you will need to get your creditor’s consent to transfer the ownership of the car. You will also need to find another way of transportation after you sell your car.

Surrendering your car voluntarily: You can surrender your car to your creditor voluntarily, which means that you give up your car without waiting for the creditor to repossess it. This can help you avoid the stress and embarrassment of repossession, and reduce the legal costs and the deficiency balance. However, you will still lose your car and damage your credit score, and you might still owe some money to your creditor after they sell your car.

Each of these options has its benefits and drawbacks, and you should weigh them carefully before deciding. You should also seek professional advice from a lawyer, a debt counsellor, or a financial planner to help you choose the best option for your situation. Here are some tips and resources to help you find the right help:

Visit the National Credit Regulator’s website ( to learn more about your rights and responsibilities as a consumer, and to find a registered debt counsellor near you.

Visit the Legal Aid South Africa’s website ( to find out if you qualify for free legal assistance, and to locate a legal aid office in your area.


Repossession on a car is a serious matter that can affect your life in many ways. It is important to understand what repossession is, why it happens, and how it affects car owners in South Africa. It is also important to know that there are alternatives to car repossession, and that you can take action to prevent or stop it.

We hope that this blog post has given you some useful information and guidance on how to deal with car repossession.