How Do Car Finance Deals Work

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Rates from 7.9% APR. Representative APR 22.09%

Representative Example: Borrow £6,000 with £1,000 deposit over 48 months with a representative APR of 22.09%, the monthly payment would be £152.49, with a total cost of credit of £2,319.37 and a total amount payable of £7319.37. CarLoans UK is a broker not a lender.

Car Finance

There are a number of things to consider when looking for the right car for you. If you’re asking yourself ‘how does car financing work?’ then you have come to the right place. One of the things to consider is what type of car finance is for you, which is why at Car Loans UK we aim to provide all the relevant information regarding car finance, allowing you to make the perfect finance choice.

Car Finance

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Representative Example: Borrow £6,000 with £1,000 deposit over 48 months with a representative APR of 22.09%, the monthly payment would be £152.49, with a total cost of credit of £2,319.37 and a total amount payable of £7319.37. CarLoans UK is a broker not a lender.

How Does Car Finance Work?

The Initial Deposit

This step isn’t always required. Although, placing down a deposit when completing a car finance agreement is highly recommended.

Repayment Plans

Depending on the agreement that has been put in place for example HP, PCP & CS, your repayment plan may vary.

Contract Completion

Upon completion of your contract, you will then have a number of different options available to you. Which we will state below.

CriteriaPersonal Contract Purchase (PCP)Hire Purchase (HP)Conditional Sale (CS)
The Initial DepositThe Majority of Lenders Will Require A DepositOptionalOptional
Repayment PlanYou Pay Less But Have 3 Options At The End of Your AgreementPayments Are Slightly Higher Than PCP However You Will Own The Car At The End of Your AgreementPayments Are Slightly Higher Than PCP However You Will Own The Car At The End of Your Agreement
Contract Completion• Optional Final Payment - Pay This And Own The Car

• Pay Nothing More And Hand The Car Back

• Trade The Car In, Using Positive Equity To Fund The Deposit For Your Next Vehicle.
A Small ‘Option To Purchase’ Fee, Which You Need To Pay To Become The Legal Owner Of The Vehicle (Maximum £50)No Final Payment, Car Is Yours After The Last Instalment
Fixed Monthly PaymentsYes - You Can Make Overpayments Up to 8 Times A Year And Up To £8000. This Reduces Your Term Or Monthly Payments.Yes - You Can Make Overpayments Up to 8 Times A Year And Up To £8000. This Reduces Your Term Or Monthly Payments.Yes - You Can Make Overpayments Up to 8 Times A Year And Up To £8000. This Reduces Your Term Or Monthly Payments.

Types Of Car Finance In More Detail

At CarLoans UK, we provide numerous amounts of different finance options across our car finance brokerage site. Which then allows you to find the best way to pay with ease. Including but not limited to PCP Car Finance, HP Car Finance or No Deposit Car Finance just to name a few. Because CarLoans UK has got you covered,  don’t believe us? Then take a look at our excellent trust pilot reviews and see for yourself.

get an instant online decision

Using our quick and easy form you get an instant decision in a matter of minutes. Apply for a car finance 24/7 days a week through our short form.

Search any reputable dealer

Choose from any reputable car dealer nationwide and find a car that suits you, your budget and is local to you.

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Once we have dotted the I's and crossed the T's, we will do the rest of the paperwork for you so it's nice and easy!

Why Choose CarloansUK?

The old traditional way of buying a car is by getting the car finance at the same place as you buy the car from. Although this doesn’t always ensure you the best finance deal, which is why using a car finance brokerage service is essential when asking yourself how do car finance deals work?

If you get the finance first from CarLoansUK, you are buying your car from a position of strength, you know what you can afford. Because often dealers can only offer a limited number of deals from one finance company. But at CarLoansUK we have many lenders on our panel, so we can make sure you are getting the best finance deal for you when we help you compare car finance.

Plus, we do all the admin, paperwork, and negotiations with the dealer. Because this way, you can drive straight off in your newly purchased car instead of spending hours in the dealer’s sales office.

When you choose CarLoansUK to conduct a car finance search, you can rest easy knowing you are in safe hands. Because we aim to make comparing car finance as quick and easy as possible. Because our specially trained brokers are here to provide you with an unparalleled level of service, to make the car finance brokerage process as smooth and as easy as can be to help you drive away in the perfect car for you as soon as possible.

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Rates from 7.9% APR. Representative APR 22.09%

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CarLoansUK © 2022 All rights reserved

Car Loans UK is a trading style of Wallace Bohen Ltd, a company registered in England and Wales. (Company number: 12382512, Registered Address: 4th Floor, Kingsgate, Wellington Road North, Stockport, Cheshire, SK4 1LW. We act as a credit broker and not a lender and are authorised and regulated by the Financial Conduct Authority for consumer credit FCA no.928674. CarLoansUK can introduce customers to a limited number of finance providers based on overall credit profile and may receive a commission for such introductions, this will not impact the rate you are provided. We do not charge a fee to the customer for arranging the finance. Written quotations on request. All finance subject to terms and status Data Protection Registration No.ZA766848.

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