Buyers beware of ‘dodgy finance’
Classic car finance specialists are warning enthusiasts to be wary of finance deals on high-end classics that look too good to be true.
Classics and Sport Finance managing director Rob Johnson says he has seen more brokers attracted to the market in the past three years as customers borrow money to buy classics.
Johnson says: ‘Customers have come to me to help them refinance their classic after they were sold a deal which left them with 65 per cent of the cost of their vehicle left to pay at the end of their finance term.’
JBR Capital, a classic car finance specialist and the official finance partner for McLaren, also advised buyers to steer clear of ‘too good to be true’ deals unless they are confident that they can afford to cover any shortfalls on the finance.
Darren Selig, JBR Capital chief executive, says: ‘If the purchase is for pure enjoyment then buyers should work on the basis of a minimum 15 per cent year-on-year depreciation and if it’s an investment purchase then the buyer should be aware that investments may fall in value as well as go up.’
Richard Barnett, CCW’s markets editor, said that even if finance makes it possible to get into a dream classic, the deposit and monthly price on finance is just the start of the story. He says: ‘When you buy something high end, that’s not the end of it – there’s upkeep and all the costs that go with it.’
CCW contacted the Finance and Leasing Association (FLA) about the growth in classic car finance but a spokesperson said they did not collect data on the type of vehicles financed and was unwilling to comment further.
Finance of high-end classics have increased by up to 27 per cent since 2015, according tp pawn broker, HNW lending.