Ruahine Finance ‘Good News” for everyone buying cars.
By Daiman McIntyre
On Friday 3rd of Marc 2017, ASIC, the Australia Securities and Investment Commission, announced that it would ban Flex commissions in Car finance.
Previously Lenders would provide dealerships with a base rate for a loan, usually around 7-9%, which is then provided to the end customer; however the car dealer could adjust the rate that was provided to the customer upwards so that the rate the customer would see have been around 14% or more.
This higher rate was essentially the commission paid to the person setting up the loan in the dealership.
While lucrative for the person arranging the loans, it was often unfair of the unsuspecting car purchaser.
What Does It Mean?
What this means for customers buying cars, is that the loans will become cheaper and it should also means that loans through car yard will have less hidden costs than previously.
These changes will not take immediate effect in dealerships as there is likely to be a phase in period across the industry.
As always you should shop around for your finance, and get value for money, start with the website Smart Money.
For Specialist finance in one place Finance or Mortgage Brokers can provide a choice of loans for both vehicles and for homes
Daiman McIntyre is a Melbourne based Mortgage Broker called Ruahine Finance, who provides finance from a variety of lenders. Mortgage Brokers provide a free service to customers, and receive a fee or commission from a lender that provides the loan.
Credit Representative Number 482063 is authorised under Australian Credit License Number 389328
Your full financial situation will need to be reviewed prior to acceptance of any offer or product
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