Shawbrook and RAC put control over car finance truly in the hands of buyers with launch of Flexiloan

18 January 2018

Shawbrook Bank and Britain’s longest-serving breakdown company, the RAC, have today launched what they believe is a first for the UK car finance market with a new flexible loan product.

The Flexiloan product offers the sorts of benefits enjoyed by those used to popular Personal Contract Purchase (PCP) payment plans – including options for a low deposit and monthly payments and a choice of how to pay off the remainder of the balance – with the added bonuses of being able to buy a car at least two years old (and up to 9 years old) from a dealer or private seller, ownership of the car from day one and no prospect of penalty fees at the end of the agreement.

Much like a conventional car loan, the buyer is provided with funds up-front to pay for the car of their choice outright – and unlike with existing finance products like PCP this could be anything from a car just a few year’s old sold through a main dealer right through to a used vehicle featured on a private listing on the likes of RACcars.co.uk.

The customer can select their deposit, monthly payments, loan term and final payment on the RAC Flexiloan website and easily see how changing one can affect another – so for instance, if they have a bigger deposit to put down in the first place, they can correspondingly choose lower monthly payments and/or a smaller final payment.

At the end of the agreement, customers can choose how to pay off the remainder – either in one go, re-finance what is remaining of the loan, or sell the car to cover the cost of the final payment. And because they are in complete control of the loan, there are no nasty surprises such as excess mileage charges to pay.

Key features of Flexiloan are:

  • Choose from a car that is at least two years old (and up to nine years old) on sale anywhere in the UK – you’re not tied to one specific manufacturer or dealer
  • Easily see how changing one part of your payment affects other parts – complete transparency of what you’ll pay
  • Full ownership of the car from day one
  • No extra charges payable at the end of the finance period
  • Know your interest rate via a quick ‘soft’ credit check which has no effect on your credit score

Paul Went of Shawbrook Bank, said: “We saw a need in the used car market for a finance product that offers the benefits of traditional car finance products, such as PCP and HP, but gives the car owner the same control as taking an unsecured personal loan for their car purchase. As RAC has a long history of innovating to help drivers, they were the obvious choice of partner to launch this exciting new product with.”

Alastair Crossley of RAC Flexiloan said: “PCP is understandably popular as it means you can drive away in a car while enjoying a low deposit and low monthly payments. However, it’s not without its drawbacks – you can’t opt for PCP finance on many used cars and there is a genuine risk of getting stung with charges at the end of the contract.

“Working with Shawbrook we saw an opportunity to provide those looking for their next car with a radically different offering and one that puts them in complete control from beginning to end. Flexiloan gives buyers the flexibility which schemes like PCP offer, but then offers so much more: buyers can choose to buy any car that is at least two years old and can arrange their finance securely online, meaning there is no need for awkward conversations with pushy sales agents.”