Should you use a car or finance broker?

Should you use a car or finance broker?

The Sun reports that Footballer Jamie Vardy has recently called in lawyers after a car deal went wrong.

Here are our top tips to keep your funds safe and avoid paying an unnecessary premium. According to The Sun, The Mirror, and The Mail Vardy and his wife paid a £40,000 deposit to a company – S14 VIP – to secure a  new Lamborghini Urus. S14 VIP claims to act as a middleman between the stars and car dealerships.

According to The Sun, when Vardy chased up delivery of the new car, Lamborghini said that they had not received a deposit from S14 VIP. Owner Mark Pryke returned just £10,000 to Vardy, leaving him £30,000 short.

Despite Pryke saying the couple would get their money back, a source told The Sun that they have now called in their lawyers and the police.

Mr Pryke told The Sun: ‘I’ve got a cash flow problem for now… I couldn’t provide the car so they’re getting the money back. I’m not running or hiding.’


This situation raises some interesting points about brokerage and things that any car buyer should consider if they are in a broker chain.  Car brokers make their money by introducing buyers to sellers, usually when the buyer is unable to source a vehicle in their desired timescale or they are simply too busy to undertake that task at all. This is where a car broker can add value. In the Vardy case it appears that a deposit was taken for an order that didn’t exist or couldn’t be fulfilled.

Car brokers may also undertake negotiations on behalf of the buyer, although the real benefit is usually unclear particularly when you factor in the brokerage fee. When cars have a long waiting list, there isn’t usually a lot of room for negotiation, anyway….

Car finance brokerage is slightly different. Finance brokers mainly deal with financial organisations that will not deal directly with the public, and some of those brokers will be able to offer preferential terms because of the volume of business they place with those organisations. So, in essence, the broker is responsible for arranging the finance on behalf of the customer with a suitable lender. Finance brokers should also have the relevant permissions from the Financial Conduct Authority which allows them to sell and arrange finance on behalf of customers.

Added value or added price?

So – do brokers add value, or simply add more fees?

The bottom line is that the more people there are in a chain the more it will cost the buyer or end-user, so the best way to keep prices or charges down is to reduce the number of links in that chain where possible.

Car brokers are often able to add real value when it comes to sourcing vehicles but in finance, broker-to-broker business means an additional link in the chain and consequently higher interest rates and monthly payments without adding any additional value.

Top tips when dealing with brokers

1. Check the broker’s credentials – Google them to find out more and check them at Companies House. Are they authorised to offer the vehicle or finance? You can check if a business is licenced to offer credit on the FCA register.

2. Negotiate any car brokerage fee in advance – understand exactly what you are paying for and ensure the dealership invoices you directly.

3. Pay any deposit/ monies direct to the supplying dealer.

4. Protect your data. Passing your information and financial details to a third party can be risky, particularly if they are an individual rather than an organisation. Do they have the necessary data protection procedures in place or is all your personal information on their mobile phone?

5. How many brokers are in the chain? If it is more than one, consider why.

Magnitude Finance are a credit broker – part of DSG Financial Services Limited.  Established for over 30 years, we are totally independent, so working in your best interest to connect you with many lenders who will not deal directly with consumers. Magnitude Finance have an unparalleled heritage and pedigree in working with our clients to arrange the perfect funding packages for a wide range of prestige, classic and luxury cars all at the most competitive price in the market. We achieve this through our established relationships with lenders as one of the UK’s largest specialist car finance brokers.