VW mortgage riches!
March 12th, 2009 by Richard Aucock
MORTGAGE holders with a tracker deal are now a lot richer, thanks to Bank base interest rate cuts.
And this, says Volkswagen Finance, means they have more money to spend on cars!
Dealers should therefore be targeting these customers, by showing the cost-saving benefits of buying a new car. That’s because the extra available cash could easily fund a brand-new car.
Graham Wheeler, head of Volkswagen Financial Services, explained: ‘The recent changes in the Bank of England base rate mean that there are over three million tracker mortgage customers who will be up to £260 per month better off.’
Since October, the average tracker interest rate has plunged, from 6.2 percent, to 3.2 percent.
‘£260 a month spare… could equate to a nice new car.’
This is where creative use of manufacturer finance comes in – the demand for which is booming, says VW. Unlike bank finance, auto finance is not saddled by a shortage of cash.
Wheeler points out the new Golf is available with a £199 per month PCP.
‘We’re constantly reminded of the ‘credit crunch’, and many banks nowadays are unwilling to lend customers money to finance a depreciating asset such as a car.
‘But we are experts in motor vehicle finance. It’s what we do and what we’ve always done. We know the risks and we manage them.’
Countering a plunge in customer confidence, due to ‘scare mongering’, will also be key.
‘As long as customers are sensible in managing their finances, there’s no reason why they should fear making a big purchase in what are seen as troubled times.
‘People with a stable job, such as those in the public sector, whose mortgage payments which may well have recently gone down, should take advantage of the economic climate and seize the chance to buy.’
As an example of the customer-tempting deals out there, Wheeler illustrates a typical VW Solutions deal, on a new Volkswagen Golf 1.4 TSI SE 5dr:
Term: 36 months
Mileage: 10,000 a year
35 monthly payments of: £199
First payment fee: £125
Optional final payment: £7230
List price: £15,962
Advance payment from customer: £4,352.77
Amount of credit: £11,609.23
Total amount payable: £18,607.77
Typical APR: 9.7 percent
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