Getting vehicle finance even for a private sale

South Africa has a vibrant market for used cars, so vehicle sales between private individuals are common. This can sometimes be a cheaper option than buying from a dealership, but both parties in the transaction need to take certain precautions to avoid any headaches.

As a buyer, how do you know the car won’t break down in a few weeks’ time? As a seller, what happens if the buyer fails to pay for the car despite an agreement in place? It’s advisable to arrange private car sales through a regulated process, so that all parties are satisfied.

MFC, a division of Nedbank, not only provides vehicle financing for private buyers who qualify, but we can also help both buyer and seller ensure a hassle-free sale.

What private sellers need to consider

As a seller, you need to know the value of the car before you can decide on the price you want and advertise the vehicle for sale. Often the book value of the car is not the only yardstick. Other factors to consider include the demand for the car, its age, the mileage and any expensive extras you may have added.

It also matters whether the car is still under warranty or not. Even the colour can affect demand for a second-hand car: black shows scratches far more than white and silver. Take all these factors into account to set a realistic expectation of the money it could fetch on the market.

What private buyers need to consider

As a buyer, you need to do your homework about any car you’re considering buying. Is the seller really the owner of the vehicle? Is the car in good condition? Does it have a full service history? Has it ever been in an accident? Does it have a warranty? Is the mileage low enough? Has it been through a DEKRA safety check?

You can ensure that the process is safe and secure for both parties

Unless you’re satisfied that the car you want meets all these conditions, don’t buy it. It’s important to get what you pay for.

Good reasons to finance a private car sale through MFC

MFC can provide vehicle finance for second-hand cars if they’re not more than 10 years old, they’re valued at R50,000 or more, and they aren’t recovered stolen vehicles. A major benefit of securing finance for a private sale through MFC is that we will then ensure that neither buyer nor seller is cheated or defrauded.

When granting a loan for a private sale, MFC does the following:

  • Conducts the administration, verification and re-registration of the vehicle.
  • Ensures that the technical inspection and roadworthy certification are done by the seller.
  • Ensures that payment is made to the seller or the finance provider, if the seller is still paying off a vehicle loan.
  • Ensures that the vehicle has an existing warranty or helps you buy one.

What documents you will need

Both parties will need to submit documents with their particulars to MFC.

Buyers must provide:

  • a valid South African identity document;
  • a copy of their driving licence or both sides of their driving licence card;
  • proof of income;
  • proof of residence;
  • details of the car on sale and
  • contact details of the seller.

Sellers must provide MFC with a certified copy of their identity document, proof of address and banking details. They also need to show that the car belongs to them and is fully paid off. If the vehicle is still financed, they will need to produce a settlement letter from the financing institution, the original registration document, and a signed Notification of Change of Ownership (NCO) form. Additionally, the seller must ensure that all outstanding licence fees, traffic fines and toll fees are paid in full, and that personalised numberplates are removed before the transaction is finalised.

Once MFC has received all the documents and the creditworthiness of the buyer has been established, we can grant a loan to allow the purchase of the vehicle. Afterwards, a new NaTIS vehicle registration certificate is issued confirming the new ownership. By choosing MFC to finance a private vehicle purchase, you can ensure that the process is safe and secure for both parties.


Did you know that if you take out MFC vehicle finance and open a Nedbank Savvy Plus or Savvy Bundle Account, you can get R200 a month cash back for the duration of your loan? For an affordable car loan tailored to your circumstances and value-added extras like cash back, choose the bank that’s best for your money.