be on the lookout for lenders charging large upfront fees – and to
steer clear of funders which use this tactic.
Chief executive of the NACFB, Adam Tyler, said that he had
received an increasing number of calls regarding upfront fees.
“These fees can amount to thousands of pounds, and the lender makes
no guarantee that in return they will lend money to the broker’s
client. The NACFB’s advice to any broker who finds themselves in
this situation is not to deal with a lender who tries this kind of
tactics,” Tyler said.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
Tyler put the reappearance of advanced fees down to “current
difficult economic conditions”, with brokers and clients
“vulnerable” to the practice “because they are desperate for some
kind of financial assistance”, as sources of funds dry up. One of
the reasons the NACFB was set up in the first place was to provide
protection for members from advanced fee-charging, he pointed
out.
Meanwhile, the difficult economic conditions can be seen to have
taken their toll on the NACFB’s membership over the past year, with
the association’s annual poll of members showing that vehicle
finance written by members dropped by 14 per cent compared with
2007, to £1.1bn (2007: £1.3bn).
Total business in all areas written by members, however, fell by
19.5 per cent to £15.4bn, suggesting that vehicle finance brokers
did not perhaps fare as badly as intermediaries in other sectors.
Membership grew by 9 per cent over the period, Tyler reported.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData
