The latest monthly car finance figures show that car buyers are borrowing more and more money to finance both new and used cars, despite all the media attention directed at PCP car finance.
Overall borrowing in July was up despite a slowdown in new car volumes, which mirrored the new car registration figures from the SMMT for the same period.
The results for July, published today by the Finance and Leasing Association (FLA), show a 7% decrease in the number of new cars financed in July compared to last year, but the average borrowing increased by a significant 15%, meaning that total car finance debt grew by 3% over the same month last year.
Used car results also show that more buyers are continuing to borrow through dealer-provided finance, and are continuing to borrow more money on each car. Overall use car finance debt increased by 17% over the same month last year, which was a result of 10% more cars being financed at an increase of 6% more borrowing per car.
The used car results reflect an increasing number of car buyers choosing PCP car finance for used cars as well as new cars. Used car finance via dealers has doubled in the last five years, with an increase of 23% average borrowing per car in that time.
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