Getting a loan in this day and age can be incredibly tough. Those who genuinely need financial aid, such as those seeking cash loans and are blacklisted, can be both left feeling disappointed and frustrated. Today we’ll explore how to get a loan if you’re self-employed, why short-term loans are growing in popularity and how you can get a hassle-free online loan in South Africa.
Let’s start with what being blacklisted actually means. The term blacklisted or blacklisting dates back to when credit bureaus only kept negative information about people. Today it’s changed and is different. Credit bureaus keep both positive and negative information regarding your credit history. Blacklisting is based on repeated failures to pay on time, which is linked to your credit score, which considers good and bad credit actions, essentially when you’ve paid your credit on time and when you’ve failed to do so. The good news is that even if you are blacklisted and have a bad credit score, you can build it back up again. Our most significant piece of advice is never to ignore unpaid bills. And a great solution to do this if you’re in a jam is a collateral same day cash loan.
Getting loans for self-employed South Africans
There are many advantages to being self-employed; unfortunately, getting a loan is not one of them. Self-employment means having the freedom to decide how to manage your business, time, and direction in life. However, even though entrepreneurs can generate huge wealth, banks favour salaried workers.
Self-employment often means that you are reliant on others for your income, and thus there may be times where a loan is required. Yet, if you were to walk into a bank today, they would need strict lending criteria. Some of these include:
1. You’d need to submit bank statements for the past six months or longer.
However, this fails to take into account that every business tries to limit its tax exposure. Your bank account would likely show that you use 90% or more of the money deposited into the account, which isn’t a realistic example of the income you’ve generated over the last six months. Banks don’t like this and thus are unlikely to give a personal loan to the self-employed. To explain this I’m going to use an example.
Let’s say we have two people, Sally & John. Sally is an entrepreneur and self-employed, she has an income of R15000 per month. John is on a salary and earns R20000. Sally, works from home and thus can apportion half her rent R4500, wifi cost R200 and a portion of her food eaten on company time, which costs R2000. In reality, the bank sees John as earning more, but Sally is actually earning R22700 per month, which is exactly why this current model is dying out and collateral loans are on the rise!
2. Lenders require proof of income & good credit history.
Compared to a salaried employer, your petrol, office expenses, and a portion of your food might be put through the business, which will not reflect as income. Not to mention that even if a single debit order was not honoured during the past six months, it could mean that you do not qualify for a short-term unsecured loan.
3. The bank would need a few days to process the above.
Add to this the frustration of waiting several days for approval, and it becomes clear why you have more than likely been looking for a viable alternative. Fortunately, we have an ideal solution for salaried and self-employed people, regardless of their credit histories, which is faster.
Why short-term loans against cars are popular in South Africa
Short-term loans against cars have become exceptionally popular in South Africa as alternatives to unsecured and bank loans for several reasons.
No credit checks
Due to unforeseen financial emergencies, people often have to juggle who gets paid and who does not, to survive. This leads to late or partial payments of store accounts, bonds, car repayments or any other form of credit. However, lenders report such payment behaviours, and when someone wants to apply for finance or a personal overdraft, they hit a brick wall.
Lenders are not eager to give money to people with mediocre or poor credit records. The sad part of it all is that millions of consumers in the country have poor credit histories. Pawning a vehicle for cash does not involve any credit checks, making it an easier way to access a short-term credit agreement than an overdraft. As a bonus, as there are no hard credit inquiries (such as from a bank), your credit score will not be negatively affected even further!
No need for proof of income
As short-term loans against cars do not involve creditworthiness assessments, applicants do not need proof of income. Banks and conventional lending institutions, as well as micro-lenders, require salary slips and bank statements. For someone without regular monthly income, accessing credit for starting a business or getting a deposit for a rental can be challenging. This is especially true for freelancers. The pawning option levels the playing field, giving anyone who owns a fully paid up vehicle the chance to access cash quickly when they need it.
Asset as security
Unlike other short-term loans requiring income or other forms of security, the car, bakkie, and several other movable assets are used as security. As such, a person can borrow money against a second vehicle, such as their caravan. In this instance, borrowing against a vehicle, actually helps the borrower in more than one way. The asset is safely stored in a highly secure facility where it is protected against weather elements, theft, and unauthorised use. Instead of the vehicle taking up space and being at risk of damage or theft while at the property of the borrower, it is kept safe. The lender also ensures it during the repayment period.
No need to ask questions about the use of the loan
Quite frankly, it’s none of our business as to what the loan will be used for. As long as you’ve given collateral as security, you’re free to do exactly what you want. It does not matter why the person wants to borrow money against their vehicle. What they want to do with their money is up to them. People often use the money to:
- Pay off credit cards and store accounts
- Cover medical expenses
- Go on overseas vacations
- Put down deposits on rental abodes
- Put down deposits for property purchases
- Cover the cost of relocation
- Bridge cash-flow problems
- Invest in business opportunities
- Start their own ventures
- Prevent foreclosure on their homes
- Pay for home renovations
- Pay for weddings
- Put down a deposit for a new vehicle
- Pay school fees
- Self-employed and need to pay expenses
These are just a few examples of how short-term loans against cars or other types of movable assets are used to improve lives or help in difficult times.
If you’re looking for the same day cash loan and you’re blacklisted, we can assist from Pretoria, Johannesburg, Cape Town, Sandton and Witbank. These are our locations:
- Pretoria East – Building 2, Villebois Office Park, Cnr De Villebois & Jacques Streets, Moreleta Park, Pretoria, Gauteng
- Pretoria North – Office 107, Normed Centre, 260 Burger Street, Pretoria North
- Witbank – Smokey Mountain Business Park, Unit 105, 1st Floor, Route N4 Business Park, eMalahleni, Ben Fleur x11, 1039
- Boksburg – Oakhurst Office Park, Unit 8, Corner Ridge and Trichardt’s Road, Bartlett, Boksburg, Gauteng
- Rivonia Sandton – Block A, 2nd Floor, Edenburg Terraces, 348 Rivonia Boulevard, Rivonia Sandton, JHB, 2128
- Pinelands Cape Town – Unit B40, Pinelands Business Park, New Mill Rd, Pinelands, Cape Town, 7450
If you’re looking for more information on secured loans, the type of loans that Xcelsior provides, read our blog post on secured loans in south africa.
Hassle-free online loans in South Africa
South Africa certainly has its fair share of unscrupulous loan providers. Yet, most will still ask for proof of income or look at your credit score. We are different. We do not require you to have income, a good credit history, and even bank statements. Our process is quick and easy. Below are some of the reasons why our online loans actually are hassle-free.
Online or Telephonic Application
Paperwork is tedious, and having to go through a lengthy credit check process is equally frustrating. However, with our short-term loans in South Africa, you do not have to complete pages of documents. The amount is based on the security you provide. As such, we do not care if you are blacklisted.
If the securities value is R1000, we’ll never loan you more than that amount. In fact, our practice is only to loan half R500. This is beneficial for you and for us, and you won’t overexpose yourself to credit.
What Type of Security?
Our short-term loans are granted against owner vehicles. With this business model, we are able to provide cash to clients from our offices in Pinelands, Rivonia, Witbank, Pretoria East and Pretoria North without requiring credit checks and proof of income.
Instead of having to sell your vehicle because you need cash fast, you can apply online or telephonically for one of our short-term loans. We assess the vehicle value at one of our branches, and based on the results of the assessment, offer an amount. If you approve, the amount is paid into your bank account, often on the same day.
How Long Does it Take?
The application is quick. Indeed, it can be completed in less than an hour, and you can have your same day cash loan even if you’re blacklisted within 30 minutes from approval. It is fast and convenient. There is no paperwork and no hassle.
What Do We Require from You?
You require a valid driver’s licence, the original registration papers of the vehicle to show ownership, and the car. If the car is registered in your company’s name, we require the vehicle registration papers and the company documents.
What does it mean to own an asset?
The asset is no longer under finance. If you lease the vehicle or still pay the bank monthly, then the bank still owns the vehicle. To qualify to get a loan against your car quickly, you must have the original registration papers, and the vehicle must be paid in full. If you meet this requirement, then you are only a few steps away from quickly getting a loan against your car, bakkie, truck, trailer, or caravan.
What Happens to Your Vehicle?
You can drive it to our offices, we then transport it by truck to a secure storage facility. We can also collect it from your home (T&C’s apply for home collections). The vehicle is stored at the storage facility for the duration of the agreement. It is returned to you once the loan amount has been paid in full.
The storage facility has 24-hour access control, electric perimeter fencing, and CCTV monitoring. Your vehicle is kept safe and is not driven for the entire period. We have insurance to cover all vehicles at our storage facility.
How do you take out a loan with XCELSIOR?
The process is quite simple. We have a simple sign up form that you need to complete on our website. You can apply for a loan right here. You will be required to provide us with your personal details as well as the details of the vehicle that you are planning to use as your form of collateral.
Applying for loans with XCELSIOR is completely safe and legal. We are a registered credit provider and comply with both the National Credit Act and the Consumer Act. We offer our clients absolute discretion and will not provide your details to any third parties without your consent. At XCELSIOR, we have your best interests at heart and will offer you a professional and dedicated service at all times.
When hunting the market for the easiest way to obtain loans that are quick to set in place and do not present many inconveniences and frustrations, we at XCELSIOR Loans are just the place to turn to.