Financial Conduct Authority
The Financial Conduct Authority expects any intermediary to disclose to its customers that a commission may be payable by the owner or creditor to the intermediary, and, if the customer asks, the amount that is payable as commission. The Financial Conduct Authority has made it clear that “commission” means any financial consideration.
We want to help you find a suitable asset finance product that meets your needs. This document sets out the key factors you should consider.
Credo Asset Finance Limited are authorised and regulated by the Financial Conduct Authority, FRN: 670710. Credo Asset Finance Limited are authorised by the FCA to conduct Credit Broking. This can be verified on the FCA Register (https://register.fca.org.uk/s/firm?id=001b000000k2h2xAAA) Credo Capital Finance Limited are authorised and regulated by the FCA, FRN:670362, as an authorised Credit Broker and Lender. This can be verified using the following link (https://register.fca.org.uk/s/firm?id=001b000000k26U0AAI)
We work with a panel of finance lenders to find a potentially suitable arrangement for you. Sometimes we act as the lender ourselves. We will discuss this option with you if relevant.
Once we have found a potentially suitable arrangement, we will present the lender’s agreement to you which we believe achieves the appropriate customer outcome for you based on the information you have provided us with. It is important that you read the whole document carefully. We will discuss the agreement with you and will be happy to explain the terms of the agreement but if you have any questions in relation to the terms and conditions, please refer them to your accountant or financial advisor. Credo Asset Finance Limited or Credo Capital Finance do not provide or offer advice.
Do I need Asset Finance?
The main options for financing newly acquired asset are to purchase the asset outright for cash, arrange a bank loan, rent for a short period (typically less than one year), or take out an asset finance agreement. A lender providing asset finance will purchase the asset from the supplier you have selected, at the price you have negotiated. You will then hire or lease the asset from the lender. In deciding which option to select, relevant factors may include whether you have the cash to buy outright, how long you need the asset for together with the relative costs of the different options.
What types of lending are there?
Most asset finance arrangements involve paying a deposit and then monthly payments. One key difference between products is what happens at the end of the agreement and who gets title the asset.
Hire Purchase: Is a finance agreement which is secured against an asset where title only passes to the borrower when the agreement has ended and all monthly instalments and the option to purchase fee have been paid in full.
Operating Lease: Is a contract that allows for the use of an asset but does not convey rights of ownership of the asset.
Lease: Is a finance agreement which is secured against an asset where at the end of the agreement, there are a number of options that may be available to you depending on the type of lease that you have entered into. This may include extending the lease term, returning the asset to the lender, receiving a refund of sales proceeds upon the sale of the asset by the lessor or upgrading the asset via a new agreement. There is no intent for asset title to pass from the lessor to the lessee with a lease at the end of the lease period.
Loan: Is an agreement to borrow a defined amount on the basis the loan is to be fully repaid within a set time period.
Conditional Sale: Is very similar to Hire Purchase but when you have made all the payments under the agreement, you automatically take ownership of the asset.
Personal Contract Purchase/ Business Contract Purchase: This product is usually only available to finance vehicles. At the end of the agreement there is an optional large final payment to purchase the vehicle and option to purchase fee. Alternatively, you can return the vehicle to the lender, The final payment is dependent on your estimated annual mileage. In deciding which option to select, relevant factors may include how long you expect to use the asset for and the income or corporation tax, VAT and accounting treatment of the product.
Suitability of Asset Finance?
Asset finance may not be suitable in certain circumstances. You should be aware that you will have to continue to pay for the asset for the agreed period even if you no longer need the asset or it cannot be used. If you change the asset during the agreed minimum rental period, this could lead to higher charges. Asset finance is unlikely to be suitable if you are not sure if you will need the asset for the minimum contract period. Asset finance is unlikely to be suitable if you are not sure the asset will be maintained and kept in a useable condition for the minimum contract period.
Pre-Contract Credit Information
Where your agreement is a regulated by the Financial Conduct Authority, your repayment schedule, repayment amounts, and the total amount payable are detailed in the Pre-Contract Credit Information. You will be asked to read the Pre-Contract Credit Information and you can take this away to seek further explanations where required. Failure to make the payments as they fall due will mean that you have broken the terms of the agreement and could result in a lender taking further action against you. This may include repossession of the goods and or obtaining a charge against a property you own. You may also incur additional costs and it could make it difficult for you to obtain credit. The Pre- Contract Credit Information will also detail your right to withdraw and early settlement information.
We do not charge you a fee for our services, whichever lender we introduce you to, we will receive commission from. Different lenders pay different commission amounts based on different commission models and different interest amounts.
For transparency we work with the following commission models: either a fixed fee or fixed rate of commission, a percentage of the amount you borrow or rate for risk (this is based on the risk profile of the proposal). Under some commission models that we operate under, the more that you pay to the lender the more that we may receive by way of commission.
Where Ignition are acting as the lender no external commission is received. We will always direct your proposal to the funder that offers the appropriate customer outcome, if you are wanting to understand the amount of commission payable or commission model, please contact us on 01675 469219.
A condition of taking out an asset finance agreement is that the asset must be insured.
At the beginning of your application, Credo will have gained your consent to complete a credit search and by signing this document you have confirmed that your consent has been given. To approve your application our lenders or Credo will supply your personal information to Credit Reference Agencies and the Credit Reference Agencies (CRAs) will give the funders information about you, such as your financial history. The lenders or Credo, do this to assess credit worthiness, product suitability, check your identity, manage your account, trace, and recover debts and prevent criminal activity. The lenders will continue to exchange information with the CRAs on an ongoing basis, including about your settled accounts and any debts not fully repaid on time. CRAs will share your information with other organisations. Your data will also be linked to the data of your spouse, any joint applicants, or other financial associates. The personal information you have supplied may also be shared with fraud prevention agencies who will use it to prevent fraud and money-laundering and verify your identity. If fraud is detected, you could be refused certain services, finance or employment. We only retain personal data for the purposes for which it is collected and for a reasonable period thereafter where there is a legitimate business need or legal obligation to do so. For detail of our current retention policy, email [email protected]
Credo’s privacy notice can be found with the following link https://www.credoassetfinance.com/privacy-policy
CIFAS Privacy notice can be found on the following link https://www.cifas.org.uk/privacy-notice Credo Asset Finance Limited are registered with the ICO, Reference Number Z1296983 and Credo Capital Finance, reference number Z2063154
We rely on the customer for the accuracy of statements, information and representations notified to ourselves by the customer. Please ensure all the information you provide to Credo is fully up to date, accurate and complete and does not omit anything which could be material to your application.
Ability to pay
We and other lenders will assess your ability to pay. You should make us aware of any future changes that may affect your ability to make the payments detailed in your agreement. These changes will be communicated to the creditors lending unit for further consideration.
If you have any health issues that could affect your ability to fully understand (the product) or commitment you are entering into, you should consider very carefully whether you need further time to consider this application or whether you would like a family member or friend to help you to make your decision. Please tell us if this is the case.
Missed payments could possibly result in the risk of losing the asset which is the subject of the Finance Agreement and the loss this could entail. The repossession can take place without a court order. The repossession may not clear the debt owed.
If you have a complaint about our service, please contact Credo on 01603 703180 or [email protected] We will acknowledge your complaint and aim to resolve the complaint as quickly as possible. Credo aims to provide a final response to all complaints within 8 weeks. Our complaints policy is available on our website (https://www.credoassetfinance.com/complaints-procedure/) If you are unhappy with the way your complaint has been handled, please contact the Financial Ombudsman Service (http://www.financial-ombudsman.org.uk/), telephone number: 0800 023 4567 For complaints that do not fall under the Financial Ombudsman Service’s jurisdiction, where Credo are unable to resolve the complaint to your satisfaction the Finance and Leasing Association’s code sets out the procedures which are available to you, including arbitration.