No Deposit Car Finance

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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.

What Is No Deposit Finance?

Buying a new car is an exciting prospect. However, for all but a few, it will mean entering into some form of finance agreement to fund the purchase. Because if you don’t have an existing car to offset against the new purchase or savings, then you may be looking for a car loan for the whole value of your new car.

A personal loan remains the most popular way to finance a car. Of course, this can be a particularly attractive finance option if you don’t have a deposit to put against the purchase.

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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.

No deposit finance in more detail

We know that identifying the right loan for you and navigating your way through the application process can seem complicated. Fortunately, at Car Loans UK, we are committed to helping to make the process as easy as possible.

Instead of having to complete the application process several times with several lenders, you can enter your details just once on our site. Because our smart technology will then search for loans that match your requirements.

Taking out car finance without putting down a deposit can make the whole process much quicker and simpler. Then there is no need to save up in advance for the deposit or sell your existing car.

This type of car finance can particularly appeal to first-time car buyers. For first-time car buyers or those who have not owned a car for some time, the ability to purchase a car without having to save up for a sizeable deposit first can be attractive. It can mean that they are on the road in their own car sooner than they may have been otherwise.

Those purchasing a second car for the household could also benefit from no deposit car finance. Increasingly, busy families find that having two cars in the household is the most practical option. Because there is no car to trade in, the choice can be between saving for a deposit for car number two and waiting, or taking out a loan for the full value and going ahead with the purchase more quickly.

The higher the loan value, the more it will cost overall as interest is applied across the full value.

In addition. Because the loan will be larger, this is likely to mean either higher monthly payments or a longer loan term. Whilst a longer loan term makes budgeting easier, it should be considered that this likely means a higher overall cost when you choose used car finance deal with no deposit. 

Taking out car finance, either with or without a deposit, means that you are making a financial commitment. Then in some cases, this could mean a fairly long term commitment. So it’s sensible to compare no deposit car finance options to determine which will be best suited for your individual requirements. Things to consider include:

  • The annual percentage rate, usually referred to as the APR, will tell you the interest rate you will pay over the term of the agreement. This is a useful guide when comparing loans from different providers.
  • The term of the loan, or how long you will be paying it back for, is another important consideration.
  • Longer loan terms may mean lower monthly repayments. APR is applied across the full term of the loan. Because of this, the total sum will be greater.
  • Using CarLoansUK can also help when considering how to compare no deposit car finance. An independent broker has access to a far wider range of options than individual lenders usually would. This is because an independent broker is not tied to offering specific finance products in the same way as perhaps your bank or building society may be.

The basic premise for obtaining finance will be the same regardless of the lender. However, there are likely to be slight differences between lenders. This can make the ultimate difference to their ability to offer a product which suitsthat your requirements. This is why it is a good idea to compare options.

There are, however, requirements to which all lenders must adhere when considering an application for car finance. These include:

  1. Applicants for loans in the UK must be at least 18 years old
  2. When applying for a loan, most lenders will require that the applicant has been resident in the UK for a minimum of 3 years
  3. Loan applicants must not be currently registered as bankrupt

Other points which can improve the options available include holding a full UK driving license, having an improving credit score or an existing good credit score, and being able to evidence that you will be able to afford repayments.

Obtaining finance can be more difficult in some circumstances. However, whilst options may be reduced, there are still likely to be lenders that will be able to offer possibilities.

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.

Car Finance Comparison In More Detail

At CarLoansUK, 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 CarLoansUK has got you covered,  don’t believe us? Then take a look at our excellent trust pilot reviews and see for yourself.

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Frequently Asked Questions

A car finance broker is essentially a middle man between the customer and the lender. A car loan finance broker will take care of all of the complicated paperwork as well as the negotiations with lenders. Which essentially means you can sit back and relax knowing that the broker is fighting your corner to get you the best deal possible. All whilst making your car finance journey as stress free as possible. Not only this but car finance brokers such as ourselves, also have deals that aren’t usually available to the general public, and to top it all off. Car finance brokers will actually charge the dealerships instead of the customer.


If you have been refused by other brokers in the past, all is not lost. At CarLoans UK we have a number of finance options for those with bad credit scores. However, you should be aware that when you apply for car finance through us, a hard credit check will be conducted, which may in turn have a negative impact on your credit score. Especially if these credit checks have been done in quick succession. So therefore it is recommended that after being declined for car finance, you should wait between 3-6 months before applying again.

If you are struggling to keep up with your car finance repayment plan. There are a number of options available to you. It is of great importance that you obtain free independent advice from one of the following charities/organisations. 

Money Advice Service

National Debt Line

Citizens Advice

Initially, applying for a car loan usually will have a negative impact on your credit score. Although, you should be aware that if you make your car loan repayments on time. This will most likely have a positive impact on your credit score.


APR stands for annual percentage rate and is the total amount charged for the lend. There are, however, two different types of APR.Exact APR in short means that the rate that is shown to you, is the rate that you will get. Whereas, representative APR however, means that 51% or more of the people who apply for the finance will receive that rate. What this means is that customers with poor credit scores could see a higher APR.

Representative APR is, for the most part, used to advertise the companies rates. After you have provided all of the necessary information to the lender, they can then offer you your exact APR rate.

What is it?

Gap insurance stands for Guaranteed Asset Protection.

Essentially gap insurance is, is a form of insurance that is designed to cover the difference between the amount your insurance provider pays out in the event of your vehicle either being written off or stolen and the price that you paid for the vehicle. You should however be aware that gap insurance works alongside your standard car insurance and is in no way a substitute.

So when is gap insurance needed?

Gap insurance can be worthwhile in several ways. Firstly, if you have taken out a big loan to buy your car. Gap insurance would be beneficial as mentioned previously if your car is stolen or written off. This is because the gap will pay off the outstanding finance.

As well as this, gap insurance could also be beneficial if you are worried about your car depreciating. A brand new car will lose between 15-35% of its value in the first year. Therefore gap insurance can help you get a bigger payout if your car is written off after it has already depreciated.

Where can I get gap insurance?

Comparing gap insurance quotes has never been easier thanks to Bright Compare!

If the vehicle is faulty on delivery, you can simply refuse the car and send it back to the dealership.

You can, however, you will have to ask the finance company for permission prior to making any sort of modifications.

You may assume that checking if you can get a no deposit car finance deal will take longer than normal. But this is not the case! Simply start a quote with us at Car Loans UK today and we will set your used car finance no deposit application in motion. And we will act on behalf of you to speak to the dealers and lenders in order to secure your vehicle. 

Some factors that decide whether you are eligible for a used car finance no deposit deal include your credit score and purchase history. Compare credit reports here.

You could be able to secure a contract from another lender or dealer if you have been refused no deposit car finance in the past.

Certain actions will stand you in good stead to get a used car on finance with no deposit:

  • Make any outstanding payments and ensure any future payments are on time.
  • Register with the electoral roll to make it easier for lenders to make checks. This will increase your trustworthiness in your no deposit car finance application.
  • Secure a guarantor. This is a friend or relative who agrees to make any payments on your behalf if you are unable to do so. 

When you begin your used car finance no deposit application, you need to pass an affordability check. This includes providing payslips and bank statements as proof of income.  

Other affordability factors to bear in mind include the type of vehicle you need. The more powerful the vehicle, the more fuel that will be used. Also, this is typically more expensive to repair. And road tax will also be higher due to the CO2 emissions and the risk of theft.  

Don’t be dismayed if it turns out the car that you want is not quite in your price range. Because we will work with you to find a cheaper or more suitable alternative.

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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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