How to Avoid Being Ripped Off by Dealer Finance Offers
Tradies or ’cashed up bogans’ are a welcome sight at most car yards because they are targets of high interest loans and buyers of insurance that they don’t necessarily require.
www.financefortradies.com.au expert Shane Smith said that over his 20 years in lending he often saw tradies pay too much for their finance and have loans that do not meet their overall needs.
“I constantly get calls from tradies who have been blatantly ripped off and want to refinance into a lower rate facility,” said Mr Smith. “The tradies’ loans that we see can have interest on them as high as 20 per cent and insurance products on top of that they do not need, or didn’t know they had,” he said.
“Most tradies do not ask what they are signing up for and are often bullied into signing the documentation so they can have the vehicle that day.”
Mr Smith said tradies should do their research or employ an independent finance broker before committing to any finance contract.
Some of the warning signs to look out for are:
- Not all information disclosed by the Dealer Finance Consultant
- Interest Rate not Disclosed
- Quick Sign-up of Loan Documents
- Suggestions that Low Doc Loans Attract a Higher Rate
Mr Smith said that most banks and lending institutions now implemented a points scoring and profiling system for each client and the interest rate was determined by how a client scored. “Time in job, deposit amount and asset backing are the main determining factors of interest rate,” said Mr Smith. “You can imagine the calls I get when the tradies finally realise they have paid too much. In some cases we are unable to refinance as the exit and setup costs of the new loan outweigh the benefit of a lower rate loan.”
Mr Smith runs Finance For Tradies which specialises in Vehicle and Equipment Finance. Further information is available from the website www.financefortradies.com.au
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- Contact Information
- Shane Smith
- Managing Director
- Finance For Tradies
- (61) 1300 175 175
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