10:23 am, July 15, 2020
Used car buyers coming back to the market after the coronavirus crisis are much more creditworthy.
That’s according to Startline Motor Finance, which says that credit scores over the past few weeks have been higher than in this year’s first quarter.
Chief executive Paul Burgess said: ‘This is a very definite trend and indicates that the post-lockdown used car motor finance market is actually already quite different from that seen before the coronavirus crisis.
‘One reason is perhaps more obvious – most of the used car buyers currently in the market are people in a secure financial position and comfortable with the idea of taking out a new finance agreement.
‘Those with much less solid economic prospects have effectively removed themselves from the market for the time being, presumably to wait and see how their situation pans out over the next few months.’
There had also been notable changes in the motor finance sector structure.
‘At the top of the market, prime lenders are tightening their underwriting because of a generally cautious attitude towards overall economic prospects and this has a cascade effect on the whole market.
‘As a lender that sits just behind these first line of providers, we are now seeing applicants coming to us who are more creditworthy in greater numbers.’
He added: ‘The initial burst of pent-up business that was seen when car dealers reopened after lockdown appears to have now peaked, and the market is settling at what we hope is an ongoing and sustainable level.’
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