Tuesday, May 20, 2008
Independents lose Welcome finance option
Welcome Car Finance, a leading sub-prime car loan lender, has pulled funding from all of its independent dealerships to focus solely on its own outlets.
It is understood to have cut its ties with 300 to 400 used car dealers, leaving borrowers with poor credit ratings to choose between its 12 own-brand dealerships.
The move came as its stock exchange listed parent, Cattles Group, announced a £200 million rights issue to bolster its reserves.
A motor industry finance expert, who asked not to be named, told AM: “Quite major specialists who use Welcome, for example Carcraft, will really struggle.
I think quite a few of those specialist sub-prime dealers will cease to trade.
“Without access to money to lend, some will not be able to continue.
The only other major sub-prime lender left is British Credit Trust in Slough.
But it will not have enough money to go round everyone,” he said.
DATED: 20.05.08
FEED: AM
It is understood to have cut its ties with 300 to 400 used car dealers, leaving borrowers with poor credit ratings to choose between its 12 own-brand dealerships.
The move came as its stock exchange listed parent, Cattles Group, announced a £200 million rights issue to bolster its reserves.
A motor industry finance expert, who asked not to be named, told AM: “Quite major specialists who use Welcome, for example Carcraft, will really struggle.
I think quite a few of those specialist sub-prime dealers will cease to trade.
“Without access to money to lend, some will not be able to continue.
The only other major sub-prime lender left is British Credit Trust in Slough.
But it will not have enough money to go round everyone,” he said.
DATED: 20.05.08
FEED: AM
