As Brokers and Dealers Fail Protect Your Car Finance Payments

Saturday, 8. November 2008

The ‘recession/credit crunch’ is already cutting fairly deeply and now is a time to think very carefully about the financing of your next car. Not only should you take care over the type of finance that you use but you should also take care over the supplier. In the last week I have heard of three dealer groups that have gone, locally we lost Sidlow, mainly VW, Audi, Seat and Alpha as well as Barkers Citroen and another VW Audi dealer, Dane. This has been bad news for those who paid deposits and initial rentals to these companies, now in administration, as they will have lost their money. Even worse if the car that you ordered was on long delivery as the order may well have to be placed again with all that lead time lost as other dealers in the network snap up the cars previously ordered. So what can you do? First of all only use an accredited broker and be prepared to pay a little over the cheapest rate you can find. Some brokers (Internet advertisers) are hitting desperate times and are cutting margins to levels that can’t sustain them which may result in you not having your car delivered and even losing your initial rental/deposit. Be especially cautious if the broker requests the initial rental cheque be made payable to them. We only ever have initial rental cheques made payable to either the finance house or the dealer. If you are asked to pay the dealer a deposit or initial rental see if he will accept a credit card payment, it will protect your payment even if you have to pay a small fee for them to accept your credit card. You must never forget that the people you deal with on the Internet are working for you and not the lender, if he disappears with your money you will have no claim against the leasing company. By Graham Hill