Car finance sales expected to increase
【Summary】A survey reveals that 50% of UK consumers who have financed a vehicle purchase in the past year are concerned about the affordability of their monthly payments. Younger car buyers are more worried than older ones. Many respondents felt that dealers should do more to discuss repayment obligations, explain terms and conditions, and disclose the salesperson's qualifications.
According to a recent survey conducted by ALPHERA Financial Services, half of UK consumers who have financed a vehicle purchase in the past year are now worried about the affordability of their monthly payments. Out of those surveyed, 10% expressed being 'very concerned' while an additional 40% said they were 'somewhat concerned'.
The survey also revealed that younger car buyers were more likely to be concerned about affordability, with 55% of them stating that they were 'somewhat concerned', compared to only 16% of those aged 65 and over.
Interestingly, 43% of respondents reported that the dealer did not take into account changing economic circumstances when discussing affordability. On the other hand, 66% of participants believed that dealers have a responsibility to discuss repayment obligations, 58% felt that dealers should explain terms and conditions along with any additional charges, and 31% believed that dealers should disclose whether the salesperson is qualified or accredited to sell a car finance package.
Kirk Franks, the head of national sales at ALPHERA Financial Services, commented on the findings, stating that they indicate the ongoing impact of the cost-of-living crisis on car buyers. Factors such as inflation, rising interest rates, and higher fuel costs have contributed to the affordability concerns. Franks also emphasized the importance of dealers ensuring fair value and transparency, which aligns with the new Consumer Duty.
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