If you’re looking into car finance options, you’ve probably come across a few vehicle finance brokers, like Wheelie Good Finance. The question is, should you use a broker when it comes to taking out a car loan? While we are a bit biased, most people agree that the answer is yes! Using a broker service comes with a whole host of benefits, some more obvious than others.
Why Should I Use a Car Finance Broker?
When people take out a mortgage, in the majority of cases, they’ll approach a mortgage broker. This is because buying property is almost certainly the largest purchase you’ll ever make, so you want to get the best deal. In terms of interest rates, even a fraction of a percent can make a big difference to the total amount you’ll repay.
While a car loan probably won’t be as expensive as a mortgage, it can be a considerable amount of money. So using a broker to find a suitable deal makes sense! A broker is essentially an organisation who can compare the top deals on the market, and present you with the best option. They’ll also take your individual circumstances and requirements into account.
Still a bit unsure? Many people choose to use broker service as there are a number of benefits - from saving money to speeding up the car financing process. We’ve gone through five of the biggest advantages below!
1. Find a Suitable Deal
Perhaps the biggest benefit of using a broker service is that you could save money. While the interest rate you’re offered will mostly depend on things like your credit score and your current financial situation, different lenders will offer different rates. And a broker will compare these rates for you, to find you a suitable deal.
Of course, some brokers will charge a fee for this service, so you may not end up saving money overall. But here at Wheelie Good Finance, there are absolutely no hidden fees or charges - we instead work on a commission basis with our lenders.
2. Compare Multiple Options
If you were to simply go to a dealership to compare finance agreements and offers, your choices would be fairly limited. Most dealerships will only be able to offer deals from a few lenders, as those will be the ones they’re affiliated with. And if you have a low credit score, some dealers may not be able to help you at all, as they might not work with specialist bad credit lenders.
When you work with a broker service, you can be assured that there will be far more options to choose from, including lenders that specialise in car finance for bad credit. And a large network of lenders should mean that you’ll be able to find a deal with a low interest rate!
3. Insider Knowledge and Preferential Terms
Until you start looking into car finance options, chances are, you probably won’t know too much about the choices available. You might know whether you want to get a Hire Purchase (HP) agreement, where you’d be covering the value of the car, and own it outright at the end of the term, or a Personal Contract Purchase (PCP) agreement, where you’d be paying towards the depreciation of the vehicle, and can choose to make a balloon payment or walk away once your contract ends. But what about the lender, and the actual agreement? A broker will have insider knowledge about these things, and can help you find a finance provider that offers great terms, and is likely to accept your application.
Not only this, but brokers have already forged relationships with their panel of car loan providers. This means that they may be able to access preferential terms and other discounts that simply may not be available to others. Overall, a broker can find the best deal for your personal circumstances.
4. Save Time
Finding the best car finance lender can be a time consuming process. First, you need to create a list of lenders, not all of which will be included on comparison sites, and then you’ll need to check your eligibility against each one. This can take hours, and be incredibly stressful. But with a broker service, we do all the hard work for you, comparing lenders and putting you in touch with a suitable vehicle finance provider.
An additional benefit of this speedy process is that most brokers work completely online. Here at Wheelie Good Finance, our entire application process is 100% online, so you don’t need to leave the comfort of your home to find a great lender!
5. Find Specialist Lenders for Bad Credit
Bad credit doesn't necessarily mean that someone is bad with money - often it will be due to circumstances outside of their control. For instance, not having much of a credit footprint can lower your credit score, as could making late repayments years ago. Self-employed people can also have trouble finding a car finance provider. While we can’t offer guaranteed approval, we work with a lot of specialist lenders that will take more than just your credit history into account.
It’s also good to bear in mind that if you were to apply with multiple lenders, to see which one would accept your application, this can mean a lot of hard credit searches. These will be reported on your credit file, and can lower your credit score. When you apply with Wheelie Good Finance, we only undertake soft credit checks, which won’t impact your score.