New cars might stand out for their state-of-the-art features and ‘new car smell’, but used cars have plenty of their own benefits too. There are more second-hand motors on the road than ever before, which means you could find yourself in a position where you want to purchase one. However, there are some myths surrounding the industry, the main one being that they’re so much cheaper than brand new, so you can afford to buy a used vehicle outright.

In reality, most people can’t since second-hand cars are still quite expensive. Despite being much more affordable than brand new models, you’re still looking at a total of several thousand pounds, which exceeds most people’s rainy-day fund. Thankfully, second-hand car finance makes it more affordable to buy a used car and make a substantial purchase less substantial.

Still, you need to know how much the deal will cost before you sign on the dotted line. Otherwise, the agreement might not be suitable. With that in mind, here’s how to calculate finance on a used vehicle.

Can you get finance on a second-hand car?

There’s a perception that second-hand car finance isn’t available because of the cost of used cars. According to Money Saving Expert, new motors depreciate at a rate of 27% in the first 12 months, meaning vehicles that are only twelve months old are much cheaper than their counterparts.

Yet, 27% might mean that the value is still above £15,000 or £20,000, which means you’re going to need help from a lender. Turning to car finance is essential as the deals are designed for drivers’ needs. It’s worth remembering that private sellers won’t offer the service as they simply want to offload the vehicle and make a small profit.

Of course, you’re not guaranteed to be accepted just because you applied. There are factors that determine the outcome, so let’s take a look at a few:

Credit rating

Your credit rating, or credit score, is the first thing lenders will look at before signing you off. If it’s not high enough, you might need to take certain measures to boost it, such as paying bills more punctually or avoiding hard checks. Another option is to use your credit card more regularly because you might be rejected if you don’t have any evidence of your spending habits.

The length of the deal

A longer agreement will play into your hands. Typically, car finance deals can range from anywhere between three to seven years, with six being the average. While you will pay extra the longer it lasts, the monthly payments are smaller because they are stretched over 72 months instead of 36 months.

Size of your downpayment

You can lower your finance premiums by putting down a bigger downpayment. The deposit reduces the risk for lenders and therefore can lower the rate you pay. After all, they already have a portion of the loan back, depending on the size of your deposit. However, it’s worth mentioning that you don’t need to pay a deposit to take out car finance.

At My Car Credit, we know how important it is for our customers to be accepted. That’s why we analyse a range of factors before deciding, and why we’re always happy to offer help and advice to any applicants.

How to calculate second-hand car finance

We understand that numbers can confuse people, which is why lots of motorists decide to avoid second-hand car finance in the first place. It can seem too complicated, so they steer clear of what they don’t understand.

That’s a healthy strategy. However, you don’t have to fall into this category because working out the cost of car finance is simple. You only have to do the following:

  • Take the cost of the car
  • Divide it by the number of months in the agreement
  • Add in the rate of interest

Once you have done that, you can clearly see how much you will pay overall and at different periods throughout the deal. For example, you can see the monthly fees, and use them to calculate your overall incomings and outgoings. As a result, you will know whether a second-hand car is affordable in a matter of minutes!

My Car Credit’s car finance calculator

To make matters even easier, at My Car Credit, we have developed a car HP calculator that takes all the stress and confusion out of the process. Whether you want to know how much your monthly payments will be or how much car finance you qualify for, our online tool does the maths on your next car for you in seconds. Just type the relevant details into the easy-to-use interface and let the calculator do the rest.

If you want to learn more about how My Car Credit can help you land the second-hand car finance deal of your dreams, please don’t hesitate to contact us right away.

Rates from 9.9% APR. Representative APR 12.4%

Evolution Funding Ltd T/A My Car Credit

My Credit Rating


  • You are a home owner
  • You have been on the electoral role for a long period of time
  • You have current credit arrangements and mortgage with no defaults
  • You have no CCJs, credit arrears or missed payments
  • You rarely apply for credit
  • You are employed or self-employed


  • You are on the electoral role
  • You are a home owner or long standing tenant
  • You have a stable employment history
  • You have current credit arrangements with occasional missed payments
  • You have no CCJs


  • You are or have recently been on the electoral role
  • You may have recently changed address
  • You may have occasional missed payments
  • You may have an old CCJ
  • You may have regularly applied for credit


  • You may have had frequent changes in address
  • You may not be traceable on the voters roll
  • You may have exceeded credit card limits
  • You may have missed payments on current agreements
  • You may have had a CCJ in the past


  • You may not be traceable on the voters roll
  • Your credit cards are over their limits
  • You have recent CCJs
  • You may have been refused credit elsewhere
  • You may be in a debt management plan

X monthly repayments of

Typical rate

Loan amount

Total payable




*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 12.4%, annual interest rate (fixed) 12.36%, 47 monthly payments of £196.44 followed by 1 payment of £206.44 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,939.12, total amount payable is £9,439.12.

Evolution Funding Limited, trading as My Car Credit, is a credit broker and not a lender.

Please ensure you can afford the repayments for the duration of the loan before entering into a credit agreement.

*Initial application is a soft search. Should you progress, some lenders may perform a hard search on your credit file.

Require more help?

Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!