Thank you for your question.
Voluntary surrender consists of two things. Firstly, you are either already behind with your payments and want to give back the car, or your payments are not in arrears but you want to give back your car as you know you won’t be able to keep up with the necessary payments in the future.
Voluntary Surrender: If your payments are up to date
If you know you won’t be able to keep up with your monthly payments, Section 127 (National Credit Act) states that you can give a written notice to the credit provider indicating that you want to return the goods. Within five business days, you must voluntarily surrender the goods to the credit provider’s place of business or any other place as agreed upon with the credit provider.
Within ten business days after receiving the notice, the credit provider must give you an evaluation (written notice) setting out the estimated value of the goods. The credit provider will typically sell the vehicle. There are no guarantees that they will be able to sell it for what you still owe on it. You are therefore held accountable to pay the shortfall after the sale. And if they sell it for more than what you owe them, the creditor must pay the difference over to you.
If, however, you are unhappy with the value given by the creditor, you can withdraw the notice that you have sent to the credit provider and resume possession of the goods. Alternatively, you can sell your car or home privately and get a better price than they would have been able to get at an auction or via a dealership’s sale.
You should talk to the creditor first to see if your term cannot be extended instead, which will reduce your monthly instalment. With an extended term, there is usually also a better interest rate. Consider this option and don’t forget to ask your creditor about this.
Voluntary Surrender: If your payments are in arrears
If you are behind with your payments/instalments you can choose to make use of Section 127 of the National Credit Act that refers to Surrender of goods. There is, unfortunately, no way out after signing a voluntary agreement, unless, you bring your payments up to date.
Hope this info helps.