Armed with the right motor finance solutions, dealers are well placed to help buyers into their next used car despite the storm of high vehicle prices, rising interest rates and squeezed budgets.

Dealer finance is currently performing well despite high inflation rates as car buyers respond to the cost-of-living crisis by spreading costs with monthly repayments, according to lenders.

However, concerns around consumer affordability are rising and lenders are putting extra onus on dealers to apply robust processes.

According to the monthly Startline Used Car Tracker research, dealers reported 77% of consumers are now buying over a longer period, 30% are reducing lease mileage and 27% are opting for different finance products than they would usually use, with personal contract purchase (PCP) being the biggest winner.

There is some push-and-pull over deposits with 25% saying they are increasing and 30% reducing.

Paul Burgess, chief executive, Startline Motor Finance, says: “This is broadly in line with what we are seeing as a motor finance provider.

“Generally, consumers are concerned about how current economic conditions are affecting them now and could further affect them in the future.

“As a result, they are spending time ensuring that the motor finance solution they arrive at is one that they feel is affordable to them on a month-by-month basis.

“The lengthening of agreements and changes in deposit being seen are very much part of this trend.”

The tracker also found that consumer preferences of finance method have barely changed over the past six months, suggesting car buyers may not be taking into consideration how rising prices will affect their finance needs until they begin their car buying journey, which dealers should take on board.