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Inside track: Are more people refinancing their cars?

It’s during March and September, when new registrations are taking place, that it becomes more apparent on any trends for refinancing.

Our Motor finance team likes to keep its finger on the pulse by understanding how brokers are feeling and gaining insights into vehicle sales on the frontlines and our latest Headlight report: Indications on the road ahead for the motor industry has some useful findings on refinance.

While we may be nationally seeing a decline in new car registrations, as reported regularly by The Society of Motor Manufacturers and Traders (SMMT), brokers we surveyed reported that refinancing was a growing trend.

Brokers are clearly telling us that people are keeping and refinancing both new and used cars.

We asked them if the number of customers refinancing their existing car at the end of term had changed in the past 12 months. What we found was that for new cars, 43% of brokers said financing had increased, while the figure was 39% for used cars (as shown in the graphs below).

Used and new car growth

Graphs show responses to if the number of customers refinancing their existing car at the end of term had changed in the past 12 months.

Our Motor finance team believes this surge in refinancing reported in October 2018, when pieced together with other responses, indicates that an increase in the value of used cars is likely and could see diesel used cars also holding their value well as new diesel cars are now a reducing breed.

Looking for a motor finance solution or the opportunity to refinance? Discover our range of car finance options.

Paragon Banking Group PLC.  Registered in England number 2336032.  Registered office 51 Homer Road, Solihull, West Midlands  B91 3QJ.