Cambridge & Counties Bank (C&C) is working with wealth managers who are acting as introducers for its classic car finance product, which runs up to £1.5m.
C&C, already active in commercial asset finance, started offering classic car finance in May of this year, and says it has provided £2m in loans so far.
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The facilities offer funding between £63,000 and £1.5m, for a duration between one to seven years and for a maximum loan-to-value ratio of 90%. They can come in the form of hire purchase, “collection funding” or equity release.
C&C has now decided to rely on wealth managers as business introducers, taking cue from classic cars’ growth as an enticing investment, thanks to asset appreciation. It is targeting high-net-worth clients with net income above £150,000, or net assets totalling £500,000 excluding primary property.
Neil Fender, head of classic car finance at Cambridge & Counties, said: “Many of those people buying classic cars are clients of wealth managers and they may look to use their investments here to purchase their vehicles.
“Rather than liquidate them, we are providing wealth managers with an alternative solution to offer these clients the opportunity to keep their investments in place and maintain cash resources.”
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By GlobalDataIn June, C&C said the classic car finance product was part of a planned expansion into more niche asset classes, both in the B2C and B2B spaces.
“We have developed a strong and unique proposition that we hope will be well received by this market,” Fender said at the time.
In an interview in August’s Motor Finance, Darren Selig, co-founder of prestige funder JBR Capital, said slowing growth in classic car values was leading to “polarisation” in the market.
“What we have, and continue to witness, is the exit stage-right of the speculative investor who cannot make his quick buck anymore,” he said.
“The buyers are now long-term enthusiasts looking to buy into the sector at more realistic valuations and seek a deal which represents value for money.”
