Car finance brokers and providers are seeing decreased business due to
consumers fraudulently using bounce back loans to purchase cars
outright, according to a broker in the space.To get more
auto finance news, you can visit shine news official website.
Zac
Choudhri founded car finance brokerage Prime Personal Finance in
January and has since diversified into selling cars as well.Bounce back
loans come with a 100 per cent government guarantee on the value of the
loan and have a 2.5 per cent interest rate, with nothing payable for the
first 12 months.
“When you sell a Range Rover it’s not normally
someone treating themselves to a car but to someone who is slightly
better off than the average household and is able to qualify for it and
buy it,” Choudhri said.
“But now we’ve sold so many on direct
payment. We promote and recommend our in-house car finance brokerage and
show the benefits of it, but some people said ‘no, we already have a
2.5 per cent loan’.We’ve sold cars to these people and absolutely loads
of people with business loans have just bought cars and this has
generally affected car finance brokers and providers.
“Car prices
have gone up as a result of these loans. No one was getting finance, so
they raised prices on cars. It has had a massive knock-on effect.”
The Wall