In car financing, you may encounter brokers who offer their services to make your car buying journey faster and more convenient. But what exactly is a car finance broker UK and do you need one? What can they do to make the process of getting car finance and buying your dream car much smoother? Let’s find out!
Why Get a Car Finance Broker?
When you buy a car, you have the option of buying with cash or through car finance. If you choose to finance a car, you may look for car finance online, or go directly to a car finance company, or seek the services of a car finance broker to make the process easier for you.
With a PCP car finance broker, for example, they will be the ones to deal with numerous car finance companies so they can give you a shortlist of the best financing deals. This is great if you don’t have a lot of time on your hands to research different deals from various lenders yourself. The best car finance broker can help you get the best deal that would fit your financial situation well.
Some car finance companies specialise in providing loans to a particular group of customers that have certain risk profiles. Having an online car finance broker might help you find the best lender for your specific financial circumstances so that you’ll have the best chances of getting approved for your car finance application.
What’s important to note is that car finance brokers are not the ones who will lend you money to buy a car. Their services are as a third party and limited to simply finding car finance deals, and arranging the best deal between you and the car finance company.
Car Finance Lenders vs. Car Finance Brokers
Car finance companies often specialise in a certain group of clients. For example, a lender may cater to young drivers, applicants with low credit scores, or car buyers with excellent credit ratings. Having this type of risk profiling for their clients allows lenders to process applications more efficiently. They will also be able to predict which customers are most likely to fall behind in making payments.
Dealing directly with a car finance company may take some work, especially if you don’t know the specific group of customers that they cater to. Generally, if you have a low credit score and a high-risk profile, you’ll most likely be offered higher interest rates. This means taking out car financing might be more expensive for you.
Car finance brokers are familiar with different lenders and which groups those lenders can cater for. So if you get a broker, they will be able to direct you to the right car finance company that can offer the best rates. This is one of the benefits of getting a broker. You don’t have to guess which lender to get car financing from because you have an expert to guide you.
How Brokers Find the Best Car Finance Company
Brokers need to know a number of details from you to know which car finance company suits you best. For example, some of the information they need to know is: your credit score, how much you need to borrow, the type of vehicle you want to buy, and whether you’re getting a Hire Purchase deal or a Personal Contract Purchase agreement.
Once they know these details, they will then be able to assess your risk profile and find the most suitable lender that can give the best rates. Once you’ve chosen the best car finance company for you, the broker can help you further by arranging the car finance agreement.
And since they are experts in car finance, you may ask them questions if there are things in the contract that are unclear to you. Of course, it’s still best to ask the car finance company directly if you have more specific questions about your agreement with them. Always make sure you fully understand a finance contract before signing it.
Brokers can also offer soft searches on your credit profile so that they can examine your credit history. It will allow them to give you an estimate of what car finance companies would most likely offer you. And since it would only be a soft search, it won’t affect your credit score the way a hard search would.
Convenient and Time-saving Car Buying Journey
What’s great about seeking the services of a car finance broker is you don’t have to spend so much time researching the best car finance companies in the UK. Brokers specialise in car finance so they can help you understand complex terms and concepts, help you prepare your documents, and guide you every step of the way.
If you don’t feel confident about how to apply and process your car finance application yourself, it might be a good idea to get a car finance broker. However, bear in mind that since your getting the services of a specialist, this means an additional expense for you so do bear that in mind.
Get Car Finance Fast with Carmoola
Carmoola is the modern way to get car financing, and by that, we mean quick, accessible and uncomplicated. With only your smartphone and the app, you can apply for financing in just a few minutes. You just have to enter your details and verify your identity using your driver’s licence.
In under a minute, you’ll immediately know the result of your application and how much you can borrow. It’s as easy as that! No more paperwork or confusing documents to fill out. You also don’t have to wait for phone calls to know if you can get financing with Carmoola. Everything is designed to make car finance convenient for you.
Once your car finance application has been approved, you can then use your virtual Carmoola card to buy the car you want! With Carmoola, you don’t need to go to a broker because we’ve made things fast, easy, and we keep things simple for you! Know more about what Carmoola offers here. And if you have any questions, please feel free to get in touch with us! 👍