You may have heard about car finance brokers, but what does a car finance broker do?
In short, a car finance broker’s role is to help customers navigate the car finance market and secure the best possible loan package for their circumstances.
A car finance broker will contact several lenders to get the best deal for you and your circumstances. They are the middleman and will organise the finance on your behalf. Like you would use a mortgage broker to arrange a mortgage for your house, a car finance broker will go through the same process for your car.
There are a number of different car finance options available, and it can be a confusing market. That is where a car finance broker comes in. They are specialists in the industry and are there to advise you on the best deal.
What Is the Difference Between a Broker and a Lender?
The main difference between a broker and a lender is who is putting up the money. The broker’s role is to act as a middleman connecting you with the lender that will offer the best deal. The lender then provides the money for the finance agreement.
For example, if you want to buy the latest Range Rover Sport, you would contact Dorsia Finance to be the broker on the deal. We would then work on your application to get the best value through one of the multiple lenders we have relationships with. Finally, the lender providing the best deal for you will pay the money for your new dream car.
The process is as simple as that, but we have broken down the steps involved when using a care finance broker in more detail below.
Why You Should Use a Broker vs a Lender
Save You Money
Brokers can genuinely compare the best deals in the market because they will spend the time, rather than you having to sit individually contacting different lenders. As a result, you can often save a fair deal of money or afford that dream car you thought was out of reach.
Through experience, brokers will understand which lenders will provide the best deal based on your application, such as the amount of money you are looking to borrow, the age and value of the car, or even the length of the term.
Save You Time
You don’t have to worry about contacting multiple lenders to find the best deal because a broker will handle everything. You only need to submit your details once and reduce the required paperwork. A broker will make the process as easy as possible so you can focus on your car purchase.
Access To More Options
Independent finance brokers deal with a wide range of lenders, which can provide a far greater choice of options. Options that you may not be able to access through the high street.
Protect Your Credit File
A finance broker will do a soft search on your credit file, which won’t harm your credit score. A single soft search is more beneficial than shopping around with multiple lenders who will each perform a hard search on your credit file, each leaving a mark.
With a broker, only once you have decided on the best finance deal that suits you is there one (and only one) hard search on your credit file.
Benefits of Financing Through a Broker Rather Than a Car Dealership
Many people don’t realise that you don’t have to organise your car finance through a dealership and are entirely within your rights to source this elsewhere.
For these reasons, it would be best if you considered financing through a broker rather than a car dealership.
Best Possible Rate
The benefit of going through an independent car finance broker is that they aren’t trying to push you into a finance deal that may benefit them in terms of commissions. Instead, they are more interested in ensuring customers get the best possible rates.
Shop Around For Cars
When financing through a broker, you can shop around at multiple car dealerships for the perfect car without worrying about losing your finance deal.
If you get a finance deal through a dealership and then change your mind about buying a car through them, you must go through another finance agreement at a new dealership. Meaning, another hard search on your credit file and the hassle of submitting the same paperwork a second time.
Steps Involved When Using a Care Finance Broker:
- Assess your financial situation: A car finance broker will review your financial information to determine your borrowing capacity and identify any potential issues that may impact your ability to secure financing.
- Researching lending options: The broker will explore various options to identify the best deals and loan packages that meet your needs.
- Present the loan options: The broker will present you with a range of loan options, outlining the features, benefits, and costs of each option. This information will help you decide on which loan to choose.
- Facilitating the loan application process: Once you have selected a loan option, the broker will assist you in completing the application process, gathering the necessary documentation, and submitting the application to the lender.
- Negotiating loan terms: The broker may negotiate with the lender to secure better loan terms or interest rates on your behalf.
How Can a Car Finance Broker Help?
If you want a truly personal service, you will also appreciate using a broker. Everything is tailored to your particular needs, and you have your broker at the end of the phone for any questions and help. Many car finance brokers can even source a car for you or offer refinancing as an option.
And best of all, it’s an entirely free service as brokers make their money through commission from the lender, and nothing is required from you!
Here are our top 5 reasons why you should get car finance through a broker.
When should I get in touch with a car finance broker?
You can get in touch with a car finance broker at various points. For example, you can chat about how much you could afford to borrow before looking at a car. Some customers will get in touch after seeing a car they want to buy and will request a quote, and others will have an idea in mind of the vehicle they’re looking for and ask for a rough quote so they can adequately crack on with it their search.
If you are interested in taking advantage of the benefits of using a car finance broker, contact us or even use our free online car finance calculator to find out how much you could borrow.
info@dorsiafinance.co.uk | 01522 420 420
