After an influx of complaints about the repossession of vehicles by banks when people fall behind with their vehicle finance repayments, the Ombudsman for Banking Services , Reana Steyn, says it is necessary to clarify the rights of both consumers and banks in such circumstances.
The Ombud says her office received several complaints from bank customers who appeared to believe that since a bank’s right to claim repayment of the debt had prescribed, its right to repossess the asset had also prescribed, and ownership somehow automatically passed to the customer. She says it is more important than ever that consumers know their rights. Banks are not a law unto themselves and cannot repossess a vehicle without following the procedure set out in the National Credit Act 34 of 2005 .
The Sheriff of the Court has delivered the original warrant of execution to the consumer stating that the vehicle can be repossessed. Voluntary surrender should be a consumer-initiated exercise, free of any undue pressure or threats from the bank or its representatives, Steyn explains.
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