GMAC UK to Make Car Finance Credit Advertising Clearer

Following discussions with the OFT, car finance provider GMAC UK plc has agreed to change its credit advertising in order to make it clearer for consumers.

Car finance advertisements placed by the Luton based company in newspapers and on the Saab website were considered by the OFT to be in breach of the Consumer Credit (Advertisements) Regulations and Section 46 of the Consumer Credit Act. The Regulations are designed to ensure that advertising is truthful and transparent and that it provides consumers with a balanced picture of the product being offered.

Concerns expressed by the OFT centred on adverts offering finance on Saab vehicles. Although GMAC UK plc and the OFT were not in full agreement regarding all the issues raised, the company has responded positively and agreed that in the future it will:

* include all relevant items of financial information in a credit advertisement and ensure that it is shown together as a whole and with equal prominence,

* give a single typical APR in a credit advertisement and ensure that where a range of APRs is indicated that the lowest APR and highest APR have equal prominence, and

* ensure that credit advertisements do not give the misleading impression that monthly payments in a credit agreement are for less than a stated amount, when in fact some of the monthly payments exceed that stated amount.

The OFT has also approached a number of other car finance providers whose advertising is also of concern.

Ray Watson, OFT Director for consumer credit said:

‘Regulations governing credit advertisements are designed to ensure that consumers receive information about the true costs of the credit on offer and it is important that businesses comply with these requirements when drawing up their advertising.’

Source: Office of Fair Trading (National)

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