Brokers Better For Dealer Leases

Monday, 26. October 2009

Over the last few months we have seen a great deal of activity in dealerships offering a greater variety of finance products to customers. Manufacturer provided finance facilities are offered through ‘captives’ that are either funded by the manufacturer or through a major finance provider. The funder provides the facilities on documents printed in the name of the manufacturer. As a result of increased competitiveness us brokers have started to use more of the dealer provided finance than the facilities offered by traditional lenders operating in the broker sector. This is often the case with Citroen, Renault, Mercedes, Audi, VW and others. Not always on all models but often selectively on individual models that are cheaper than other lenders. But if this is the case why shouldn’t you use the dealer for your finance, why use a broker who is obviously making a profit? Well first of all brokers, like me, with nearly 30 years experience in asset and motor finance and in my case also an accountant, can provide more information and advice than most dealers. We normally deal direct with a fleet department that has access to better rates than the retail department. We also have our own ‘tame’ dealers who we know will provide a good service and will support our clients should there be any problems with the car during the lease/warranty period. Also, some finance arms of manufacturers have a terrible reputation when it comes to customer care and end of contract charges, the worst culprits in our experience are probably Mercedes Benz Finance and Chrysler. As lenders try to recoup losses by charging customers outrageous amounts you really need to know what you are doing if you are to avoid the end of contract charges which can often be measured in several hundreds if not thousands of pounds. The dealer is generally not interested in problems arising from the finance or he simply doesn’t know how to deal with the funder, who is effectively part of their corporate group, in order to reduce or remove excessive or unfair end of contract charges. As a broker I am more likely to get your repeat business than a dealer so it is in my interest to provide you with extra support during and at the end of the agreement. Should you use the dealer? No, you should use a professional, such as me, who will work with the dealer and you to make sure that you have a great experience. By Graham Hill