One of the most important decisions when buying a car is who you’re going to buy it through. You might be considering a broker, or perhaps going through a dealership. Either way, it’s worth knowing the risks involved with these options.
While buying from a vehicle broker should be a stress-free experience, there are some things you should be aware of. In this article we’ll be talking about some of the risks involved with buying through a vehicle broker, and how you can reduce, or eliminate, those risks.
How can I tell if my vehicle broker is reputable?
One of the risks involved with going through a vehicle broker is that they might not be reputable. To ensure that your vehicle broker is reputable, you should check to see if they are regulated by the BVRLA. You can find a list of BVRLA members here.
The BVRLA is a governing body that is designed to protect you, the customer. All BVRLA vehicle brokers must adhere to strict regulations to ensure that they deliver a high standard of service, fair terms and conditions, and complete transparency. To find out more you can read Why you should use a BVRLA Regulated Broker.
There have been cases, in my experience, where brokers that haven’t been trading for very long have taken deposits and then folded. One of the requirements for a BVRLA regulated company is that all the deposits are kept in a ‘ring fenced’ account. This means that if the broker did go out of business you would get your money back.
They might not be offering what you are looking for
It is possible that your vehicle broker might not be offering everything that you are looking for in a contract.
For example, you may want to part exchange your car, but a majority of brokers do not offer a part exchange, which isn’t ideal if you’ve already entered a contract with them.
They might not provide you with great customer service
One of the potential risks of going through a broker is that you may not be getting the customer service you deserve.
While they may be offering you a super low price, they may not provide updates on when your vehicle is due to arrive, or provide you with the after-sales experience that other brokers offer. If you have any problems with your car, or you have questions you want answered, some brokers might not give you the help you need.
They may not have the experience
Some brokers work out of their houses or their bedrooms. While there is nothing particularly wrong with this, it means that they may not have the experience necessary to ensure they deliver you the service you deserve.
A broker working from an established commercial place of business, however, will have an experienced team that will be able to help you find what you need.
Is it better to buy a car through a dealership or a broker?
You may be considering going to a dealership rather than a broker. And while this might be the preferred option for some, there are things you should take into account before making a decision.
Dealerships usually only have access to one funder so they might not be able to offer you the best deal for your situation. You may end up having to pay more or wait longer for your car to be delivered.
A broker, however, will have access to more funders and therefore will be more likely to find you a deal that better suits you.
It is important to note that there will be brokers who have access to more finance houses than others, so you should do your research before you choose a vehicle broker.
Car dealership vs. broker with a car cancellation
If you want to cancel your car, there is a difference between what happens if you go through a broker or a dealership. While this probably won’t happen, it’s best you know what to expect.
If you work with a dealer directly, the chances are you will sign the paperwork there and then, which means you will waive your distance selling rights.
If you go through a broker, however, those rights will remain in place. These rights should protect you should your circumstances change.
But, if you are outside the cooling period, and you go through a broker, you could be subject to penalties. The penalties could be anything from £500 to 2 monthly rentals upwards of 10% and depends on the type of car ordered and how unusual the specification is.
One funder vs. multiple funders
It’s important to note how many funders the company has access to. While they may be offering you a good deal, you might not be able to get the finance if they only have access to one funder.
However, a broker that has access to multiple funders can check the best rates for you.
Will multiple credit checks affect my credit rating?
One of the risks of going through a broker, particularly one that has multiple funders, is that you may be subject to a few credit checks.
While one or two checks won’t affect your credit, a few more will have an impact, so it’s important to take that into consideration. However, if you stick with one broker who has multiple funders, generally they only have to do one credit check and then they can transfer the results between funders so there will only be one credit check on your record.
What are the risks involved in ordering a car over the phone?
It’s easy to understand why people think that ordering over the phone is risky. However, a reputable broker will ensure that every order is checked multiple times by different people to make sure that it’s correct.
However, if a broker does not have that sort of service in place, then there is risk your order may not be correct. Again, this is down to ensuring that you choose a reputable broker.
Are there any hidden fees when going through a broker?
There is a risk that when buying a car through a broker that you could get caught out by hidden charges.
If a deal looks too good to be true; it probably is. There could be admin fees or delivery charges, some of which could be hidden under a different name.
However, this isn’t always the case, and a reputable broker will be completely transparent when it comes to cost. You can read our article on what hidden costs you could face when leasing or buying a car here.
Will there be more paperwork if I go through a vehicle broker?
The short answer is no, there isn’t any more paperwork if you go through a broker. The process is the same with the same paperwork to sign. You can read our article on what paperwork you are expected to sign here.
Essentially, while there are risks involved when buying through a vehicle broker, many of these risks can be eliminated if you choose a reputable broker. You can read our article on how to tell if your vehicle broker is trustworthy here.
Matt is known for being the joker around the office, but he also takes his job seriously. He's got a knack for knowing the best ways to get people approved on credit and works directly with OSV's key accounts across the UK.
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