Originally Posted by Iain Mac

Before you even think about mentioning finance to a customer you need to get a Consumer Credit Licence from the OFT, category C for brokerage.
To offer credit without it is a criminal offence. and few lenders will talk to you about setting up a facility without seeing your licence first.

Also, your local council may operate a licencing scheme for used car dealers - you need to check that, and you must not assume you will be covered by your mate's licence if he has one.