087 655 6000 info@finfix.co.za

Do you know what happens when you miss your car payments? Are you behind with vehicle or asset payments at the moment? This article might be of some use in understanding what might possibly happen in the days, weeks and months to come.

There are multiple stages of the collection process. This might vary significantly between financiers depending on their collection model. During each stage of the collection process credit providers will in most cases aim to adhere to legal requirements which provides some predictability to the proceedings which should follow.

The process starts the day your payment returns as unpaid.

Stage 1 of the collection process: Soft Collections

  1. Credit providers will send SMS/Email reminders regarding the missed payment, urging the consumer to make the said payment.
  2. Should the payment not be made within a few days the consumer can expect to receive calls.
  3. Calls, mails and messages will increase in intensity and the tone will change from “friendly reminders” to threats of legal proceedings.
  4. Credit providers might then start the first step in legal proceedings by issuing a formal demand or what is referred to as a “section 129 letter”. This is a requirement of the National Credit Act 34 of 2005 (NCA) and must be adhered to before any additional legal proceedings might commence.

>> It is important to note that these notifications might be delivered to the consumers residential address as registered mail. It is therefore essential to keep credit providers updated on your current residential address to avoid missing legal notices.

In terms of section 129(1) of the National Credit Act 34 of 2005 (NCA), a credit provider first needs to provide a consumer with notice of his default and a list of possible remedies to overcome the default, before enforcing the agreement in a court of law. This ensures that the consumer is given the opportunity to remedy his default by, for example, undergoing debt counselling instead of having to incur legal costs when defending legal action brought against him by the credit provider.

Stage 2 of the collection process: Debt Collectors/Repo agents

After exhaustive efforts to recoup payments credit providers might call in the help of debt collectors in an attempt to get the consumer to surrender the asset voluntarily. These persons might be free agents or sub contracted individuals. They will usually call from a cellphone and their emails will be a gmail, yahoo or similar account. Many consumers might not be aware that they have the choice not to surrender the asset at this point. Or they might be led to believe that they do not have a choice other than to surrender the vehicle/asset.


  • Only a court appointed sheriff in possession of a judgement (court order) to repossess the asset has the authority to repossess.
  • To avoid surrendering the vehicle by “mistake” do not sign any documents without reading through it and perhaps seeking legal advice or the advice of a debt counsellor.
  • You might still be eligible to apply for debt review to have your debt restructured.

Stage 3: Legal action

At this stage the credit provider has failed to reach an agreement with the consumer in order to recoup the missed payments. Debt collectors have failed to get the consumer to surrender the asset and the consumer has probably not applied for debt review or taken steps to mitigate the situation.

Credit providers will then in most cases bring an application to a court in order to obtain a judgement which would allow them to repossess the asset. Consumers will be served and will have the opportunity to appear before the court. Should the credit providers application go unopposed they are likely to obtain a judgment in favour of repossession. The asset will likely be repossessed. It is therefore advisable that the consumer make the proper arrangements before proceedings reaches this stage, if the consumer is able to do so.

We know that losing your vehicle can be a scary situation. Stay calm, talk to a debt counsellor or seek legal advice. There is almost always a solution that is fair to all parties involved.

Still have questions? Need assistance? Call 087 655 6000 and ask to speak to a debt counsellor.