Drivers Spend Far Too Little Time Considering Car Finance

Tuesday, 22. September 2009

If you are a regular reader of my articles you will know that I don’t regard those expert advisors that write in the media about car finance very highly. In fact I regard most as being daft as a house brick. But whilst an article that appeared in the Independent didn’t really change my views there were a couple of points over which I had to agree, as painful as it was! The reporter suggested that the scrappage scheme cash may run out by mid October which is a feeling shared and hoped for by many in the industry, especially as few brokers have been able to pass on benefits to their clients as the scheme was aimed at retail customers that would normally deal with the dealer direct as dealers normally take your old car in PX. With no more scrappage money and Mandelson not willing to pump in any more this may cause us to return to normality with extra bonuses that we are able to pass on to our customers, both business and personal. Having made the point that the scheme allowed for the funding of 300,000 vehicles and we are already beyond 200,000 with a build up of people waiting for the new 59 registration, the article then went on to touch on the problems attached to car finance and the fact that people act far from sensible when they arrange the finance on their cars, something that I have talked about on several occasions. The article referred to an Esure poll that revealed that more than two thirds of motorists do no research at all on the finance deals available when changing their cars with only 13% spending more than a couple of hours researching the best deals before signing the agreement. At this point the statistics start to fall over as they go on to say that one in 7 motorists take out dealer finance (14%), one in 10 take out a personal loan (10%) and one in 20 swipe their credit card (5%). That makes a total of 29% so what about the other 71%? They certainly don’t take out leases and there aren’t that many that can afford to pay with cash so I guess the others simply steal them! But there is a serious point here and that is little time is taken to research the finance options (of which according to my new book there are over 40) before agreeing what could be totally the wrong finance for your needs and incredibly expensive, added to which the industry is unregulated so you are leaving yourself wide open to be ripped off by those offering finance that should really be made illegal. So carry out more research and read my blog posts and advice. Or better still buy a copy of my book, An Insider Guide To Car Finance. By Graham Hill