Finance chief rebuffs claims that car buyers have been mis-sold loans
Daily Mail investigation said ‘irresponsible lending’ was taking place, but finance chief says ‘no-one was mis-sold anything’
Claims that car dealers have been ‘reckless’ when offering loans has been challenged by a leading industry expert.
Adrian Dally, head of motor finance at the Finance and Leasing Association, has said that a Daily Mail investigation into personal contract purchase car loans wasn’t an accurate representation of the buying process.
Speaking to Car Dealer Magazine, he said: “To be honest, nobody was actually mis-sold anything here. They’re reporting on mystery shoppers talking to sales people but nothing was ever sent through to a finance company for actual credit checking.
“That’s the line of defence. Responsible lending is what motor finance is about. As a finance company, you don’t have a business unless what you lend comes back to you. That’s why we have a thorough underwriting process. Nobody [mentioned in the Daily Mail] went through that.”
The Daily Mail article said that “young drivers are being tempted into dangerously high levels of debt”. It added: “Last week, the Bank of England warned that drivers owe £58billion on car finance – an increase of 15 per cent in a year.”
However, Dally stated he didn’t believe the reporters had “paid any attention to what the Bank of England was saying last week when it published its Financial Stability Report”. He also noted that the report forecast that even a drastic drop in used car prices would have a “pretty negligible” effect on the financial system after the newspaper drew parallels with 2007’s sub-prime mortgage crisis.
When pressed by Car Dealer Magazine on whether he’d “dismiss” the Daily Mail investigation, Dally said: “That’s a strong word but I think we’d certainly challenge what they’re implying.”
