In our final article this month for car stocking finance we provide answers to all those commonly asked questions.
What is car stocking finance?
Car stocking finance is a form of loan or line of credit which is provided to car dealerships for purchasing stock. A dealer can purchase additional vehicles without harming their cash flow. The facility enables the business to hold a healthy and diverse range of vehicles for sale.
How does car stocking finance work?
A dealership will agree a deal for stocking finance, the finance provider will pay for any vehicles on behalf of the company. Once a vehicle is sold the dealership then repays the finance provider.
Who can apply for car stocking finance?
Any company acting as a dealership can apply for stocking finance. Obviously, there will be some eligibility criteria which the business must meet in order to secure the finance. This is typically based upon credit status and financial stability.
What documentation is required for an application?
Items such as financial statements, tax returns, business plans, inventory reports and sales performance are typically required by a lender before a line of credit can be established.
How long is the approval process?
This all depends on the business and what is required from a lender. Typically, the process will take 1 to 3 weeks to finalise.
What are the eligibility criteria for car stocking finance?
The key items for review will be credit score, trading history, turnover and general financial health of the dealership.
Can the finance be repaid early?
Yes absolutely, on most occasions the finance can be repaid early if the dealership is able to complete this.
What are the benefits of using car stocking finance?
A dealership can benefit from improved cash flow, ability to stock a larger number and a more diverse range of vehicles leading to increased sales and better profitability.
Is car stocking finance only for new vehicles?
No, it can be used for both new and used vehicles, the only difference being the terms and conditions will vary.
Hopefully these FAQ’s have answered the most typical questions asked and provides a better understanding of car stocking finance. However, if you have questions that have not been answered or would like to find out more please call us on 01993 706403 or e-mail enquiries@ngifinance.co.uk.
Leave a Reply