Balloon Payment - Audi South Africa Audi


Audi Financial Services

The National Credit Act (NCA) summarized

Fixed payment

Eleven month payment

Residual value option

Balloon Payment

Shortfall policy

Debt protection

Comprehensive insurance

Courtesy car

Warranty cover

Application

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A balloon payment is an inflated instalment that falls due at the end of the credit agreement. Under the NCA, a balloon payment can now be offered to any consumer on an instalment sale or lease agreement. The balloon amount is traditionally associated with a projected estimate value. The estimate value is influenced by the length of the credit agreement, i.e. (i.e. 36, 48 or 60 months), and by the market sentiment toward the vehicle being financed. Since the risk associated with a balloon payment is borne by the customer, he/she is liable for the full balloon value in the final month of his/her contract. The balloon forms part of the payment stream.

Audi Financial Services – a division of Wesbank