Moves outside usual channels
as demand for prestige vehicles stays high.
As demand for prestige cars stays high
and interest rates stay low, car finance brokers are keen to step
outside regular consumer business channels to offer variable rate
products on high-ticket vehicles.
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DSG Financial Services is the
latest to focus on the product, launching new brand DSG Prestige
last month on the back of a new broker facility agreed with ING
Lease (UK).
The DSG Prestige website features
an online calculator for variable rate finance, which managing
director Richard Hoggart says is “still by far the best method of
funding a big balance for this type of buyer”.
Variable rate allows dealers to
sell finance at low rates while still gaining good commission since
it is based on the London Interbank Offered Rate, which remains low
at present.
Finance agreements valued at more
than £60,260 (or more than £25,000 if a customer can prove they
will use a certain proportion of mileage on business use) are
eligible for variable rate deals, since they count as business
purchases and are thus no longer regulated by the Consumer Credit
Directive.
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By GlobalDataAnother broker, Bridford Financial
Solutions, has introduced large amounts of variable rate business
to ING Lease. The prestige finance specialist launched its own
online calculator for variable rate deals in December last
year.
After the launch, the company
experienced rapid business growth and expects increased demand this
year to take its annual business volume from £30m to £40m.
Bridford owner Tim Marlow said:
“People are taking advantage of the low rates.
“Dealer group finance houses and banks simply aren’t offering
the flexible, variable rate products like us, so we are able to
provide a more competitive and tailored route to secure sales.”
