Heels & Horsepower Magazine

Is Refinancing Your Car A Good Idea?

Refinancing your car is an option that many car owners grapple with.  In an effort to de-mystify what this means, and who should consider it as a viable option, it is important to understand what the term ‘refinancing’ means.

In a nutshell, refinancing a vehicle means replacing your current car loan or finance agreement with a new car loan to revise your debt repayment schedule. In other words, applying for another loan to repay your old debt. As the new loan is usually lower than your existing loan, vehicle refinancing may be a way to save money on your monthly car repayments.

This saving can result from obtaining a loan at a lesser amount, extending the repayment period or negotiating a lower interest rate. Some banks and lending houses also offer the option of refinancing a vehicle that is fully paid up, should it qualify.

It is important to understand what the term means and when or when not to refinance a vehicle.  One school of thought advocates that you should rather consider selling your car before you look at refinancing it.  However, the decision is not always that simple.  “If the new loan is at a lower interest rate, for example, that could save you some money in the long run,” explains Lebogang Gaoaketse, Head of Marketing and Communication at Wesbank.

It is important to carefully consider the pros and cons of refinancing a vehicle, so it is advisable to do some research on the most favourable loan terms and interest rates, before making a final decision.


  • Lower Monthly Repayments:  Refinancing can result in lower monthly repayments, which could assist those who are struggling to cover their monthly costs or who want to free up a bit of extra cash each month.
  • Lower Interest Rates: If you qualify for a lower interest rate by choosing to refinance your car, you will save money by paying less interest over the loan term and by so doing, save on your current monthly instalments.
  • Better Loan Terms: Refinancing allows you to adjust the terms of your loan, such as the length of the loan period or the type of loan, for example, fixed or variable.
  • Improved Cash Flow: Refinancing your vehicle might enable you to access more cash it you owe less than its current value.


  • Additional Fees: Refinancing often involves fees such as loan application costs or prepayment penalties which could add up and reduce the potential savings from the refinancing agreement.
  • Longer Loan Term: If you extend the length of your loan through refinancing, you may end up paying more interest over the term of the loan, even if you have a lower interest rate in place.
  • Negative Equity: If you owe more on your vehicle than it is worth, refinancing may not be an option or may not result in any significant savings.
  • Credit Score Impact: Applying for a new loan can temporarily lower your credit score if you are approved for a loan with a higher interest rate, it could negatively impact your credit score in the long run.

There isn’t a one-size-fits-all solution to structuring a car refinance deal. By being honest with yourself and knowing how much you can afford on the vehicle repayment, you would be better informed about your options.

Woman At The Wheel : Tama Mtonga

Tama Mtonga grew from knowing nothing about cars to becoming the General Sales Manager of the successful and proudly Black Owned BMW Joburg City MINI Joburg City dealership. This is her story.

Sitting in the plush lounge of the BMW Joburg City & MINI Joburg City dealership I wondered how it was that I had never met Tama Mtonga before.  Not only is she one of the few Black women at her level within the motoring industry but her being an executive at one of my most favourite car brands, should have gotten me at her doorstep earlier!  As she gracefully walked towards me to begin our interview, I had no idea that our encounter would turn the  old adage – good things coming to those who wait – entirely on its head and so that it became 

Who is Tama Mtonga?

Raised in Randfontein, West Rand Tama is the eldest of 5 children, 3 brothers and a sister.  She studied at Krugersdorp High School and later studied Marketing at the then Rand Afrikaans University (University of Johannesburg).

The Early Years

As a child I wanted to become an Air Hostess but my grandmother put me off that idea so when I got to University I went into marketing and had dreams of putting brands, and myself out there – or so I thought that is all marketing entailed! When I graduated however I couldn’t find work for quite a while until I saw an advert for BMW Sales Cadet Program applied for the position and was accepted.

Getting into the motoring industry

I knew absolutely nothing about cars when I started at the BMW Sales Cadet Program in August 2007.  In all honesty all I had wanted was a job so no, I didn’t set out with a burning desire to join the motoring industry. But as I learnt more about cars, kilowatts, fuel consumption, sales, finance and customer service the more my interest in motoring grew.  

The Come Up

The 1stcar I sold was a BMW 520i and I still bump into that first customer at various company events but from the moment I engaged with him everything I had been taught during my training evaporated into thin air! Luckily, he was extremely patient with me and I must gotten a few things right because he subsequently purchased 3 more cars from me over time. 

From Downtown to Newtown

The BMW dealership in Commissioner Street did not offer its customers the MINI brand and it became increasingly clear that we needed to cater for that market too.  So, when we outgrew the Commissioner Street building and moved into our Newtown home, we seized the opportunity to bring MINI into our stable.  Along with the move, I was promoted to General Sales Manager, a position I have held since December 2017.

Turning Challenges into Strengths

Although worthwhile, my journey hasn’t been without its fair share of challenges and I have had to learn to be patient, bide my time identify and turn setbacks into learning opportunities.  For instance, I wasn’t simply promoted to the position of Customer Services Manager; instead, I applied for it, was turned down and then offered the position when my seniors felt I was ready for the new role and had matured sufficiently to handle the responsibility that came with it.  

Knowing a Good Thing

I consider myself exceptionally blessed to have started my career at Joburg City Auto and to have Mr Stephen Nale, as my mentor.  He identified my potential when I didn’t even realise it and nurtured my progress.  He believed in me and continues to trust and guide me.  I could not have asked for a better work dad!

log onto our YouTube Channel to hear Tama’s full interview including her take on mistakes customers make when buying a car and her touching dedication to Mr Stephen Nale, her mentor.