Large number of consumers now seeking car company loans
Getting frustrated with private lender’s high interest rates and rejection of loan requests a large number of consumers are availing secured loans from vehicle dealerships. Volkswagen reports that its achieved annual target of £1bn worth car loans in a span of just seven months despite of down turn in car sales in the UK market.
Graham Wheeler, Managing Director, Volkswagen states that company could succeed due to availability of vast funds and faster disposal of applications compared to other financial organisations. He claims that company’s long term planning is fully safeguarding its lending abilities against the effects of credit crunch.
The car loans have been generally costlier than the personal loans in market, but most of the high street lenders raised their interest rates significantly.
A comparison website informs that average interest rate of the cheapest available personal loan is 7.7% as against 6.5% last year. The lenders are accepting very few applications while rejecting many more.
Volkswagen’s loans are available at 7.8% APR. Peugeot Citroen and Renault are offering finances starting at 7.9 and 8.0% respectively.
According to the spokesman of the website, company car finance products are successful due to charging of affordable interest rates, and easy availability on account of lesser risks to the company as loans are secured against the car.
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