Name your price

Firstly, it’s important to figure out just how much you’re looking to borrow. Take into account:

• The price of the car
• Your earnings
• How long you’d ideally like the loan for
• Your credit history

Be realistic. You’re more likely to be offered a better finance deal if your annual wage can comfortably pay off the loan.

Get the right finance deal for you

You can compare more than 400 loans with Auto Trader’s Finance Centre, which searches from a wide range of banks and reliable lenders. Follow these steps to begin:

1. Enter your loan amount
2. Choose the repayment period – anything from one year to 45 years
3. Tell us the purpose of the loan – in this case select ‘car’
4. Specify your residential status. Are you a homeowner or a tenant?
5. Describe your credit history by selecting from one of the three options

Buying from a dealer

Another option is to seek a finance deal straight from a car manufacturer. Some dealerships offer good deals on new cars, with warranties and low Annual Percentage Rates (APR).

Hire Purchase Agreements

Dealers can offer you a monthly repayment plan, known as a Hire Purchase Agreement (or HP).

The car is owned by the dealer or manufacturer until the last payment has been made, and you won’t be able to sell the car until you legally own it. But you’ll only borrow what you need, so won’t pay extra interest on surplus borrowing.

Personal Contract Purchases

A PCP, or Personal Contract Purchase, is where you pay a large deposit with small monthly repayments. At the end you can hand the car back to the manufacturer or pay a larger fee and purchase it outright.

For example, the PCP could allow you to pay a £3,000 deposit with 36 monthly repayments of £100. You can choose to give the car back or pay a further £3,000 to keep it yourself.

Some manufacturers will let you swap it for a new car after payment is complete. For more help on buying a car, read our where to buy advice.

Other finance deals

Secured loans

You can secure other debts against your home – but be aware – your home may be repossessed if you don’t keep up repayments on a mortgage or other loans secured on it.

Compare homeowner loans to see how much you could save.

Compare more than 400 loans with Auto Trader’s Finance Centre

Finance FAQs

Q: How can I see my credit report?
A: Get a free credit report with CreditExpert.

Q: Where can I find more information about loans?
A: Visit our A-Z of car loans page.

Q: What happens if I’m made redundant or ill and I can’t work?
Payment Protection Insurance (PPI) is a service which protects your debts should you have a sudden loss of income, due to illness or disability.

Most policies differ so read the terms and conditions carefully. Ask what percentage your insurer is willing to pay and how long for.

Q: I’m worried there may be some hidden charges in my loan – what can I do to check?
A: Visit our hidden charges advice page.

Remember the longer the loan period is, the more you’ll have to pay. Check the loan’s APR and make sure your monthly repayments are correct.

Search for the latest deals on Auto Trader