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PCP vs HP vs Leasing: Which Car Finance Option Is Right for You?

If you’re thinking about getting a new car, chances are you’ve come across the terms PCP, HP and leasing. These are the three most common ways to finance a car in the UK. And while they might sound similar, they work in very different ways.

From ownership and monthly costs to flexibility and mileage limits, each option has its pros and cons. With so many choices, it’s no wonder drivers often struggle to decide which is best for their lifestyle and budget.

This guide breaks down exactly how the three options work, so you can make an informed decision between PCP vs HP vs leasing. We’ll also show how My Car Credit can help you find the right finance deal, whichever route you choose.

Understanding the three main car finance types

Before comparing them in detail, it’s useful to understand the basic principles of each finance type.

PCP (personal contract purchase) – You pay a deposit, followed by monthly payments that cover the car’s depreciation, not its full value. At the end, you can either pay a final “balloon” payment to own the car, return it or trade it in for a new one.
HP (hire purchase) – Similarly, you’ll pay a deposit and then monthly instalments. But these instalments gradually pay off the total cost of the car. Once the last payment is made, you own it outright.
Leasing (personal contract hire) – You essentially rent the car for a set period (typically 2-4 years). You’ll pay an initial rental fee followed by fixed monthly payments, then return the car at the end. There’s no option to buy it.

It’s worth noting that PCP and HP are forms of car finance, meaning you’re borrowing money to fund a purchase, whereas leasing is technically a rental agreement.

How does PCP work?

A personal contract purchase (PCP) is one of the most popular car finance options in the UK because it offers flexibility and relatively low monthly payments.

How PCP works

Deposit – You usually pay around 10% of the car’s price upfront.
Monthly payments – You make fixed payments over a term (usually 2-4 years), covering the car’s depreciation rather than its total cost.
Optional final payment – At the end of the agreement, you can:

Pay the Guaranteed Future Value (GFV) or “balloon payment” to own the car outright.
Return the car to the finance company (as long as it’s within mileage and condition limits).
Trade it in as a deposit on a new PCP deal.

Advantages of PCP

Lower monthly payments compared to HP because you’re not repaying the entire cost of the vehicle.
Flexibility at the end of the term. You can keep, return or upgrade the car.
Access to newer cars more often, keeping you in warranty and up to date with the latest technology.

Disadvantages of PCP

Mileage limits usually apply. Exceeding them can lead to additional charges.
You don’t own the car unless you make the final balloon payment.
Extra fees may apply if the car is returned with damage or excessive wear.

Ideal for: Drivers who like changing cars every few years and want flexibility without committing to long-term ownership.

How does HP work?

A hire purchase (HP) agreement is one of the simplest and most straightforward car finance options available.

How HP works

Deposit – Typically around 10% of the car’s price.
Monthly payments – You repay the full value of the car, plus interest, over an agreed period (usually 2-5 years).
Ownership – After the final payment, you automatically own the car.

Advantages of HP

You own the car once all payments are made. There’s no large balloon payment at the end.
No mileage restrictions, since ownership is the goal.
Simpler terms, which are easy to understand and manage.
Flexible finance duration to suit your budget.

Disadvantages of HP

Higher monthly payments compared to PCP or leasing, since you’re financing the full cost.
Less flexibility as you’re tied in until you’ve paid off the agreement.
Depreciation is greater. Once owned, the car’s value will naturally decrease over time.

Ideal for: Drivers who plan to keep their car long-term and value ownership over flexibility, such as families or those who don’t frequently upgrade their vehicles.

How does leasing work?

Also known as personal contract hire (PCH), leasing differs from PCP and HP because you’re not buying the car. Instead, you’re renting it for a fixed period.

How leasing works

Initial rental fee – Usually equivalent to 3-6 months of payments upfront.
Monthly payments – Fixed payments for the agreed term, often 2-4 years.
Return the car – At the end, you hand the car back. There’s no option to buy.

Advantages of leasing

Drive a brand-new car every few years without any hassle.
Lower upfront cost than HP or PCP.
Fixed monthly payments make budgeting simple.
Maintenance packages often included for convenience.
No need to worry about resale value or depreciation.

Disadvantages of leasing

No ownership, regardless of how long you lease your car.
Strict mileage limits. Exceeding them leads to extra charges.
Early termination can be costly or difficult.
Wear and tear penalties may apply when returning the car.

Ideal for: Drivers who want a new car every few years, prioritise convenience and low monthly costs, and don’t care about ownership.

PCP vs HP vs leasing: Side-by-side comparison

Feature	PCP	HP	Leasing (PCH)
Ownership	Optional (after final payment)	Yes (after final payment)	No
Monthly payments	Lower	Higher	Usually lowest
Deposit	Around 10%	Around 10%	Typically 3-6 months upfront
Mileage limits	Yes	No	Yes
Maintenance	Not included	Not included	Often included
Early termination	Possible (fees apply)	Possible	Difficult / costly
Flexibility	High	Moderate	Low

Quick takeaway:

Want ownership? Go for HP.
Want flexibility and choice? PCP might suit you best.
Want convenience and low hassle? Leasing is ideal.

PCP vs HP vs leasing: Which is best for you?

There’s no single “best” option. It depends on your priorities, driving habits and financial goals. Here’s a quick guide to help match the right option to your lifestyle.

Best for flexibility: PCP

If you like the idea of changing cars regularly and want options at the end of the deal, PCP offers a mix of flexibility and affordability.

Example: Sarah is a commuter who loves driving newer models every few years. She chooses PCP so she can easily upgrade without worrying about selling her old car.

Best for ownership: HP

If you want to own your car outright after paying it off, HP is the clear winner. It’s ideal for those who see their car as a long-term investment.

Example: Mark is a family driver. He opts for HP because he plans to keep his car for many years and doesn’t want mileage restrictions.

Best for low monthly cost & convenience: Leasing

Leasing suits anyone who prioritises low upfront costs and zero ownership responsibilities. It’s popular among professionals and business users.

Example: Emma is a city-based freelancer who prefers leasing for predictable payments, included maintenance and the ability to upgrade every few years.

Still not sure? My Car Credit helps match drivers with a suitable option for their needs. Just get in touch.

Key things to consider before choosing a finance option

Above all, choosing between PCP, HP and leasing depends on what matters most to you. Is it ownership, flexibility or affordability?

Choose HP if you want to own your car outright and avoid mileage limits.
Choose PCP if you want flexibility and like changing cars regularly.
Choose leasing if you want the lowest hassle and fixed costs for a brand-new car every few years.

Before deciding between PCP, HP or leasing, think about these key factors:

1. How long do you plan to keep the car?

If you like to switch cars frequently, PCP or leasing makes more sense.
If you’re happy to keep one car long-term, HP may be more cost-effective.

2. How much do you drive?

PCP and leasing agreements typically include mileage limits. Exceeding them can cost extra.
HP has no mileage restrictions, meaning it’s great for high-mileage drivers.

This is one of our 6 Things to Check Before Signing a Car Finance Agreement

3. What’s your budget?

Leasing and PCP usually have lower monthly payments, but you’ll never own the car unless you pay extra with PCP.
HP has higher payments, but you’ll own a valuable asset at the end.

4. How important is ownership to you?

If owning a car matters, HP (or PCP with final payment) is the way to go.
If you value driving new cars and avoiding depreciation, leasing is more convenient.

To find out more, check out Who Is the Legal Owner of a Car on Finance?

5. What’s your credit situation?

All three options involve credit checks.
PCP and HP are forms of finance, so approval depends on your credit profile.
Leasing companies also perform checks, though requirements may vary.

Why choose My Car Credit for your car finance?

Even with our handy guide, choosing between PCP, HP and leasing can be overwhelming. That’s where My Car Credit can help.

As part of the UK’s largest motor finance network, we work with a panel of trusted lenders to find competitive, transparent car finance options that fit your circumstances. Here’s what you’ll benefit from:

Access to multiple lenders for a wide range of PCP and HP deals.
Transparent quotes with no hidden fees or jargon.
Quick, online application process with a soft credit search initially (so your score isn’t affected). Lenders may perform a hard credit search when your application is processed.
Personalised support from a friendly UK-based team.
Expert guidance on whether PCP, HP or leasing is best for you.

Whether you want flexibility, ownership or simplicity, My Car Credit helps match you with the right deal. So, you can hit the road with confidence.

Get your free quote online today. It only takes a few minutes.

PCP vs HP vs leasing: FAQs

Is leasing cheaper than PCP or HP?

Monthly payments are often lower with leasing, but you’ll never own the car. PCP can also offer low payments, though there’s an optional final payment if you want to buy.

Can I buy the car after a lease ends?

No, leasing (PCH) doesn’t offer a purchase option. If you want the choice to buy, PCP is more suitable.

Which is better for bad credit: PCP or HP?

HP is often easier to get approved for with a lower credit score, as the lender has security in the car. PCP might require stronger credit due to the balloon payment.

Do PCP or HP agreements include insurance?

No, you’ll need to arrange your own insurance. Some dealers may offer packages, but it’s usually separate.

Can I end a PCP, HP or lease early?

Yes, but fees apply. With PCP or HP, you can voluntarily terminate after repaying 50% of the total amount owed in most cases. Ending your lease early can be more expensive and restrictive.

Does leasing affect my credit score?

Like other finance agreements, leasing involves a credit check, and missed payments could affect your credit rating. However, managing it well can help build your score.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

Car on Finance Written Off: What Happens?

Car keys and a miniature car placed on a calculator, symbolising car finance, loan calculation, or vehicle budgeting.

Accidents happen – but if your car on finance is written off, you’ll need to take immediate steps to ensure that all relevant parties are informed. These parties include your insurer, the lender and the DVLA.

If you’ve written off a financed car, you must keep paying your finance until the settlement is resolved. Failure to do so will impact your credit score and may ultimately lead to repossession or legal action.

Typically, if your insurer determines your car to be a write-off, their payout will go to the lender rather than direct to you. However, if the insurance payout doesn’t cover the outstanding balance that remains on your finance agreement, you may still owe your finance lender money.

Below, we’ll outline what happens if you crash a financed car, giving you detailed next steps and advice.

What does ‘written off’ mean for a car on finance?

If an insurer determines that a car is ‘written off’, they’ve decided that the vehicle is either damaged beyond repair, or that any repairs will cost more than the car’s total value. The term used by insurers is ‘beyond economical repair’ (BER).

Insurers have four write-off categories:

Category A – The car is so badly damaged that its parts are only fit for purpose as scrap (non-repairable).
Category B – The car’s body has significant damage, but there are salvageable parts that can be used as spares for other vehicles.
Category S (formerly Category C) – The car has suffered structural damage that makes it unsafe to drive until professional repairs are made.
Category N (formerly Category D) – The car is structurally sound with either some cosmetic or electrical damage, or non-structural damage to the steering or brakes that might make the car undriveable until repairs are made.

When you make an insurance claim for a damaged car, your insurer will use these four categories to determine whether or not your vehicle is written off. This categorisation will then dictate how much your insurer will pay out for the damage.

Who owns a car on finance if it’s written off?

The owner of a financed vehicle that’s been written off depends on the finance agreement:

HP finance – The lender owns the car until final payment is made
PCP finance – The lender owns the car until a balloon payment is made
Personal loan – You own the car outright because a lender only finances the purchase

What happens if you crash a car on finance with insurance?

If you’ve got an insured car on finance that’s been written off, you need to let your insurer, lender and the DVLA know as soon as possible.

The insurer will use the four categories above to determine the degree of vehicular damage. This damage will then inform the settlement price your insurer will offer.

The settlement fee is the amount that your insurance company is prepared to pay you for the car. If you think that the total is too low because you think the car is worth more than your insurer is offering, you can challenge it. Just be aware that this will slow down the process and delay your receipt of the payout.

If you accept the settlement fee and are the outright owner of the written-off vehicle, the insurer will make the payout to you. However, if you’re using a financed car, the insurer will typically make this payout direct to the lender.

If your insurer’s payout covers your outstanding car finance balance, your finance is cleared.

If the insurer’s payout is less than your finance balance, however, you need to make up the difference.

GAP (Guaranteed Asset Protection) insurance can act as a safeguard in these kinds of instances. In cases where your insurer’s payout is less than the outstanding amount you owe to your car finance lender, GAP insurance can cover the shortfall.

	Insurer payout covers outstanding car finance balance	Insurer payout is less than outstanding car finance balance
With GAP insurance	No outstanding payments	GAP insurance covers this shortfall
Without GAP insurance	No outstanding payments	You are responsible for making up the difference, and will face a fee

What happens if you crash a financed car without insurance?

If you have a car on finance that’s written off and is not insured, you are liable for the outstanding balance on your finance agreement. Obviously, insurance is a legal requirement, but you may only have third-party or third-party, fire and theft insurance.

Without the insurance payout, you’ll be paying for this outstanding balance from your own pocket.

If you don’t make all necessary payments, you’ll face possible repossession of the vehicle or even legal action.

Having comprehensive insurance for a financed vehicle is a way to avoid facing high fees in case of accidents or vehicle damage.

What if the accident wasn’t my fault?

In instances where a car on finance is written off and you are not at fault, the other driver’s insurance should cover the payout.

You are still responsible for liaising with your lender until the balance on your account is fully settled.

Do you still have to pay finance after a write-off?

Until your car finance lender receives the insurer’s payout and confirms settlement, you are legally responsible for making your monthly finance repayments.

A car finance contract is a legally binding agreement, meaning the lender is owed in full, even if your vehicle is undergoing repair following damage.

If you don’t make your monthly payments, it will impact your credit score, and you may face further legal repercussions.

In some cases, your insurer’s payout may not make up the total outstanding balance that remains on your car finance. In these cases, you’ll be responsible for making up the shortfall, unless you have GAP insurance.

What is GAP insurance and how does it help?

If your insurer’s payout is less than the outstanding balance on your auto finance agreement, GAP insurance can make up the remaining cost so that you don’t go out of pocket.

For example, if your total finance balance is £12,000 and your insurance payout is £10,000, you’ll have a £2,000 shortfall. If you’ve got GAP insurance, this will make up the outstanding balance. Without it, you’ll be expected to pay the two grand yourself.

Be aware that GAP insurance isn’t offered as standard. As such, if you’re looking to insure a car on finance and are concerned about your options in case of accidents, speak to your insurance company about GAP insurance. It’s especially useful in the first two to three years of car ownership.

Step-by-step: what to do if your financed car is written off?

If your car on finance is written off, take the following steps:

Take photos of the damage and the numbers and car registration of all involved parties. Keep a note of other important information regarding the accident.
Inform your insurance provider
Notify your finance company
Wait for insurer valuation and settlement offer
Check outstanding finance balance vs. valuation of payout
Consider GAP insurance (if active)
Resolve any shortfall, if necessary

Moving forward after a car write-off

When your car on finance is written off, it can feel stressful. But with insurance and finance support, it’s more than possible to find a manageable way to move forward after a car write-off.

My Car Credit can help drivers like you find affordable auto finance for a replacement vehicle. Alternatively, if you’re looking for your next drive after fully paying off your previous motor finance agreement, use our car finance calculator to work out the kind of deal that might be most suitable for you.

FAQs about what happens if you crash a car on finance

What happens if I crash a financed car and it’s my fault?

If you crash a financed car and are at fault, you need to inform your insurer. They’ll assess the scale of damage and determine any payout. You’ll need to keep making your monthly finance payments and inform your lender about the crash and any liaison with your insurer.

What if my financed car is written off and I still owe money?

If your financed car is written off and you have outstanding finance to pay, you’re legally liable to repay this in full. Your insurer will offer a payout based on the degree of vehicular damage. This payout is then put towards your outstanding finance balance. You’ll need to make up any shortfall yourself, unless you have GAP insurance.

Can I get another car on finance after a write-off?

It’s possible to get another car on finance after a previous write-off, provided you repaid the outstanding finance on your previous vehicle in full. Failure to make up this outstanding balance on a financed car will impact your credit score and may affect your eligibility for future loans.

What if my car on finance with a provisional licence is written off?

If your financed car with a provisional licence is written off, you need to follow the same protocol for a fully licenced, financed car. Inform your insurer, finance lender and the DVLA, and wait for your insurer to confirm their payout to determine your next steps.

Will a write-off affect my credit score?

A car write-off won’t automatically impact your credit score. However, if you fail to make your monthly repayments or don’t make up the outstanding balance on your finance agreement, your credit score will be negatively affected.

Can I transfer my finance to another car?

You cannot swap a car finance agreement from one vehicle to another. You’ll have to make up any outstanding finance on your existing agreement before taking out a new one. Provided you’ve paid off 50% of the total amount you owe, you may be able to opt for voluntary termination.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

Can I Finance an Automatic Car?

How Much Does Car Finance Cost? Check Now!

Advantages and Disadvantages of PCP Car Finance

Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

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5 Benefits of Using a Car Finance Broker in the UK

Person signing car finance documents at a desk with a red toy car, calculator, and laptop.

Once upon a time, borrowers relied on brick-and-mortar banks or dealership finance to fund the purchase of their next car. But in today’s digital-first world, car finance is undergoing a significant shift. Many UK motorists now rely on car finance brokers to help them secure the most suitable deal for their needs and circumstances.

Today’s consumer prioritises car finance terms with flexibility, better rates and a more personalised service. UK car finance brokers offer all these via a streamlined and supportive process.

So, whether you’re a first-time buyer, are self-employed, have poor credit, or you just want to get the right deal for you, car finance brokers are fast becoming the go-to choice.

This article explains what car finance brokers do, how they differ from traditional lenders, why use a car finance broker, and how they can benefit you in your search for the most appropriate car finance for your needs.

What is a car finance broker?

In essence, a car finance broker is a middleman between you (the borrower) and a range of finance lenders.

Where banks or dealerships tend to offer you a single finance deal, a car finance broker works with a panel of lenders to find the option that best fits your financial situation and vehicle preferences.

Most importantly, reputable brokers such as My Car Credit are authorised and regulated by the Financial Conduct Authority (FCA). As such, we operate with transparency, professionalism and fairness, so you can feel confident that you’re in safe hands.

Brokers vs. lenders: know the difference

There are key differences between brokers and lenders.

Lenders are financial institutions, including banks and credit unions. They offer their own set of finance products. If you go directly to a lender, you’ll face limited choice based on what kinds of finance that one organisation can provide. What’s more, if you don’t fit the lender’s criteria, you might get rejected or be offered a deal that’s not suitable.

On the other hand, brokers work with multiple lenders. They act on your behalf to compare options, assess your eligibility and present you with the most suitable deals from across the market. This broader reach can result in more competitive rates, flexible terms and better outcomes – especially for applicants with unique financial circumstances.

Using a car finance broker is much like using a travel comparison site. Instead of calling multiple airlines, you enter your details once and get a range of suitable flight options. Brokers do the same for car finance, but with far more guidance and support.

While dealership finance might seem convenient, it can sometimes be more expensive. The rates offered are often fixed and may include commission-based markups. Brokers offer clarity, impartial advice and a better chance at finding a deal that suits your individual needs.

Unlock finance options dealers can’t always match

A major benefit of using a car finance broker is their ability to connect you with finance options that just aren’t available elsewhere. Why use a car finance broker? With a car finance broker, you can benefit from access to specialist lenders—institutions that cater to people with bad credit, those who are self-employed, and applicants with no deposit.

Car finance brokers can also give you better access to flexible repayment terms that can be adjusted based on your credit profile, income and lifestyle.

Plus, you may also benefit from lower APRs with a car finance broker. Some of the most competitive or flexible finance products are broker-only, so you won’t find them directly advertised to the public or through car dealers.

Whether you’re after a new or used car, a broker’s panel of lenders increases your chances of securing an affordable, tailored finance solution.

Why Use a Car Finance Broker – Top Benefits

Wider choice of lenders

Car finance brokers work with a broad panel of lenders, giving you access to more finance options than you’d secure through a single dealership or bank. This increases the likelihood of securing a deal that suits your needs.

Soft credit search to start

At My Car Credit, we begin every application with a soft credit check. Because this won’t impact your credit score, you can explore your options without any risk to your financial profile.

Less paperwork, faster process

Car finance brokers streamline the application process. At My Car Credit, our process is all done digitally, ensuring speedy applications and fast approvals that reduce your stress and save you time.

Expert help and ongoing support

A car finance broker will guide your journey from start to finish. You’ll benefit from the ongoing support of someone to explain your options, answer questions and handle much of the admin, making the experience less daunting.

Better approval odds for complex applications

At My Car Credit, we accept individuals with a range of circumstances and profiles. Whether you have bad credit, an irregular income or alternative needs, we know which lenders are more likely to accept your application. This targeted approach can greatly improve your chances of getting approved.

All of these benefits add up to help answer the common question – “why use a car finance broker”. They offer more choice, expert guidance, and a smoother journey to securing the right deal for you. Instead of going it alone, a broker can help you save time, reduce stress, and boost your chances of approval.

When should you consider using a car finance broker?

Different car finance applicants will have different needs and circumstances. If you fit into any of the following categories, you may most benefit from using a car finance broker:

First-time car buyers who are unsure of the finance process and want guidance.
People who’ve been turned down by banks or dealers, and need a second chance with tailored finance options.
Self-employed or freelance workers whose income doesn’t fit traditional lending criteria.
Buyers looking for a hassle-free finance journey who could benefit from expert help.
Applicants comparing options before committing to dealer finance.

How the car finance broker process works

Using a car finance broker like My Car Credit is simple, efficient and online-first. It’s really as easy as one, two, three:

Apply online – you’ll complete a short online application via our form. We’ll perform an initial soft credit check to assess your eligibility without impacting your credit score, giving you a no-obligation quote.

Get matched to a lender – our system will pair you with suitable finance options based on your distinct profile.

Choose a car and drive away happily – once you’re approved for finance, you can confidently shop for a vehicle that fits your budget. With My Car Credit, you can even use our one-stop shop of quality, pre-approved vehicles to secure your car and car finance in one go.

Apply for car finance with My Car Credit

Apply for car finance with My Car Credit to take advantage of the benefits of using a car finance broker. We’re part of the UK’s largest motor finance provider, and are trusted by thousands of drivers with all types of credit profiles.

Our online application process is quick and easy to fill out, and you’ll experience the support of a real UK-based team of Car Credit Specialists throughout the process.

We’ve got car finance available for both new and used vehicles, and can help individuals with variable credit profiles, conducting an initial soft search that won’t impact your score.

Kickstart your car finance journey by using our car finance calculator, or speak to one of our friendly team today.

Common questions about car finance brokers

Do car finance brokers charge a fee?

Most reputable brokers don’t charge customers directly. Instead, they receive a commission from the lender if you take out a finance agreement. This means you can usually use a broker’s service at no cost to you.

Is using a broker safe?

Yes – especially when the broker is FCA-regulated, like My Car Credit. Regulation ensures that we adhere to strict standards and put your interests first, operating with absolute transparency.

Will using a broker hurt my credit score?

Initial car finance applications with a broker typically involve a soft credit check, which has no impact on your score. At My Car Credit, we’ll only conduct a hard credit search once you’re ready to proceed with an offer.

Do brokers work with bad credit customers?

Many brokers specialise in helping people with poor or limited credit histories. Our broad panel of lenders means that My Car Credit can connect you with lenders who understand your situation, potentially providing finance where others haven’t been able to.

Can I get finance for a used car through a broker?

Brokers offer car finance for new, nearly-new and used cars. With My Car Credit, you may be able to get pre-approval for finance, beginning your search for a vehicle that suits your approved budget.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

Financing a Second-Hand Car: 4 Options

How Do Balloon Payments Work?

What is CS Car Finance?

Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

apply for car finance car finance car finance application car finance calculator online car finance application

Understanding How Far Back Lenders Look into Your Credit History

Hoping to secure car finance with bad credit history? It’s good to know how far back lenders check your credit history when applying for car finance. Why? Because it’s not just about your current situation.

Lenders want to understand how you’ve handled finances in the past. This helps them decide whether you’re likely to repay on time. How deep they dig depends on a few things. For example, the type of loan and your individual circumstances.

Whether your credit history is showroom fresh, has a few dings or feels like it’s been through a minor collision, knowing how lenders assess it can help you plan ahead and boost your approval chances.

Why do lenders check your credit history?

Lenders use credit checks to assess financial responsibility. They’re looking for signs that you can manage debt and make payments without fuss.

What do lenders look for?

Lenders focus on key patterns, such as:

On-time payments: These suggest you’re reliable and can stick to a schedule.

Missed payments or defaults: These raise questions about your ability to manage money.

Major financial events: Things like CCJs, IVAs or bankruptcies can indicate higher risk.

An in-depth review of your credit history helps lenders gauge the level of risk involved in offering you a loan.

How long does it take for a credit check?

Checks can take a matter of seconds to several days, depending on the detail requested and lender policies.

Matching you to the right finance

Lenders don’t just assess risk for car finance with bad credit history. They use your credit history to determine the type of finance plan that suits you. A borrower with a strong record might qualify for lower interest rates, while someone with a few missed payments may receive a plan tailored to help them rebuild their credit.

How far back do lenders typically look?

How far back does credit history go? Most lenders review your credit history from the past 6-7 years. This standard window includes key information, such as payment history, defaults and major financial events.

How do financial events change over time?

CCJs: These stay on your file for six years but carry less weight as time passes, especially if marked as satisfied.

IVAs: Like CCJs, they remain for six years and show that steps were taken to address debt.

Bankruptcies: These linger for six years but are less concerning to lenders if followed by good financial behaviour.

Recent credit activity vs older history

Recent financial behaviour holds more weight. Lenders are likely to focus on your activity over the last 12-24 months. This means that making timely payments and managing debts responsibly can significantly improve your chances and even outweigh older missteps. Even small steps, like setting up direct debits or paying off a credit card balance, can make a big difference.

What factors affect the depth of a credit check?

Not all credit checks are the same. Here’s what can influence how much of your history a lender reviews:

Type of car finance

Different finance options, like PCP, HP or leasing, can affect how closely lenders examine your record. Plans with higher final payments may involve stricter checks than straightforward agreements like HP.

Lender policies

Lender practices vary. Some focus on the last three years, while others review the full 6-7 years. Specialist lenders may take a more flexible approach, particularly for those with bad credit.

Loan size and deposit

The amount you borrow and your deposit size matter. A larger deposit reduces risk for lenders, which could result in less rigorous checks.

The impact of negative marks on your credit file

Negative marks like missed payments or defaults can make lenders hesitate. How long do they last? Here’s a closer look:

Missed payments: How long does a default stay on your credit history? They hang around for six years but carry less weight over time if payments resume. For instance, a missed payment from two years ago might seem significant, but if you’ve made consistent payments since then, lenders are likely to view your recent efforts more favourably.

Defaults: Also visible for six years, but their impact fades as your credit habits improve.

CCJs: They last six years but lose their sting if satisfied and as time passes. Satisfying a CCJ demonstrates accountability and can help rebuild trust with lenders.

With consistent improvements, the shadow of these marks can lift, boosting your creditworthiness.

Does a poor credit history mean you can’t get car finance?

Not at all. You can still get car finance, even with a shaky credit record. Here’s a quick look at some of the best options for car finance with bad credit history:

Specialist lenders

There are lenders who specialise in helping borrowers with financial challenges. You just have to know where to find them! These types of lenders assess your current financial stability rather than focusing solely on past mistakes or unanticipated issues. Many also offer flexible repayment options.

Flexible plans:

Options like PCP or HP are designed with flexibility in mind and can be tailored to suit your circumstances.

How My Car Credit helps you navigate credit history challenges

At My Car Credit, we understand that life happens. That’s why we’re committed to finding car finance solutions for everyone, not just applicants with A+ credit. We don’t believe in a one-size-fits-all approach. Instead, we work to understand your unique financial situation and match you with lenders who offer terms that fit your needs.

Why choose us?

Soft credit checks. Our soft checks let you explore options without harming your credit score.

Expert advice. We guide you through your credit history and help you find the right lender.

Tailored solutions. Whether it’s bad credit car finance or flexible payment plans, we’ll help you every step of the way.

Ready to get started? Visit our online application form or contact our team today. Securing car finance with bad credit history could be simpler than you think.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

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Balloon Payments Explained: What, Why & How

PCP Term: Everything You Need to Know

Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

car finance credit checks credit history credit reports

How to Avoid Common Pitfalls on Your Car Finance Application

A car loan application form with a green approved stamp on top. Sitting on top of that document is a black car key.

The car finance application process might not be as exciting as picking out your make, model and trim level. But trust us, it’s just as important.

What’s at stake?

Get it wrong, and you could face higher interest rates, unfavourable terms and in a worst-case scenario, flat-out denial of your application.

Get it right, and you can secure a deal that fits your budget, with manageable payments, fair interest rates and best of all, the coveted ‘your application has been approved’ letter.

The key to success? Avoiding online car finance application pitfalls. Whether you’re completely new to auto finance or are a bit of an old hand, here’s your definitive guide to avoiding the most common mistakes.

Know your budget before applying

Get your financial ducks in a row before starting the car finance application process. The sticker price of the car is important but don’t forget to factor in the boring bits. Extras like insurance, maintenance, fuel and repairs should all be written into your final budget. A good understanding of your overall financial picture will help you set a budget that won’t leave you eating beans on toast for the next three years.

Tools like a car finance calculator are your best mates here. In a few clicks, you can estimate how much you can borrow, what your monthly payments might look like and how different terms affect the overall cost. Why crunch your numbers now? It’s simple. So you can make sure you’re not biting off more than you can chew.

Check your credit score

Lenders don’t know you personally, so a simple “I’m good for it” won’t suffice for a car finance application. Instead, they scrutinise your credit score. This numerical reflection of your financial reliability is like a vehicle maintenance log, except for your personal finances. Things like your payment history, outstanding debts, length of credit history and new credit enquiries can all affect your credit score.

Don’t stress if your score’s less-than-perfect though, there are ways to get back on track.

Play it smart with lenders

Sending off online car finance applications to multiple lenders might seem like a good way to increase your chances of approval. The reality? Too many “hard searches” on your credit file can make you seem like a risky borrower. Stick to soft searches or pre-approval tools that let you check your eligibility without leaving a mark.

Use credit check tools

Check your credit score with tools like Experian and Equifax before you apply. These will show you what lenders see and give you a chance to tidy up any issues.

Explore options for bad credit

Credit score looking a little worse for wear? Specialist lenders, like the ones we work with at My Car Credit, offer tailored finance options for auto finance applicants with poor credit.

Consider any additional costs

Monthly payments aren’t the whole story when it comes to car finance. Forgetting about the extra costs is one of the most common mistakes – don’t let it catch you out.

Beware the balloon payment

There’s likely a balloon payment waiting at the end of your term if you’ve gone for a PCP agreement. It can be a nasty surprise if you’re not prepared. Check out our balloon payment guide for a full rundown on what this is.

Work with the experts

The easiest way to avoid car finance application roadblocks? Work with someone who knows the ropes. We lay out all the costs upfront at My Car Credit, so you know exactly what you’re signing up for. No smoke, no mirrors. Just clear, honest advice from professionals who know their stuff.

Make sure your car finance documents are in order

Nobody loves paperwork, but when it comes to car finance, it’s non-negotiable. Missing documents can bring your application to a grinding halt, even if your credit score is best-in-class.

Your essential checklist

Here’s what you’ll need to have ready for your car finance application:

ID – Passport or driver’s licence
Proof of address – Recent utility bill or bank statement.
Proof of income – Payslips or tax returns if you’re self-employed.
Bank details – For setting up payments.

How My Car Credit can help

Worried you’ll miss something? This is where we come in. At My Car Credit, we know our way around the car finance application process. We’ll guide you through the paperwork step-by-step and make sure you’ve got everything sorted before your application’s sent off. With the right preparation, there’s no reason you can’t get it right the first time.

Next steps for a smooth car finance application

With your budget set out, your credit score checked and your documents in order, you’re ready to hit send on your car finance application.

Here are a few final tips to keep things stress-free:

Stay organised

Create a folder (digital or physical) for all your car finance application documents. Having everything in one place saves time and keeps headaches at bay.

Ask for help when you need it

Confused about anything? Don’t suffer in silence. My Car Credit is just a click or call away. We’re here to answer your questions about the car finance application process and help you get it right the first time.

Use online tools

From the My Car Credit budget calculator to free online credit checks with agencies like Experian, online tools are a fantastic resource. Use them – they’re designed to make your life easier.

Getting your car finance application approved isn’t rocket science. Success is all about preparation, attention to detail and working with the right team. By knowing your budget, checking your credit score, factoring in all costs and getting your documents in order, you can give yourself the best possible shot of an ‘approved’ verdict.

Don’t forget, My Car Credit is here to help every step of the way, so fill out an online car finance application and let’s get started.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

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Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

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How to Strengthen Your Eligibility for Car Finance

Love the idea of car finance but worried you might not be eligible? We’ve got you. Whether your score is showroom shiny or could use a bit of panel-beating, these tips on how to strengthen car finance eligibility will get you in the fast lane to approval.

Am I eligible for car finance? Here’s the thing. A strong application isn’t just a box-ticking exercise. It’s the key to unlocking better deals, lower interest rates and ultimately, the car you’ve been dreaming of. Putting in the groundwork now means fewer obstacles, more options and a better shot at driving away on terms that work for you.

And the best part? Car finance eligibility isn’t complicated. With the right moves and a decent understanding of how eligibility works, you can boost your chances of approval.

This is where My Car Credit comes in. We’re all about making car finance accessible for everyone. Yes, even applicants with less-than-perfect credit. Ready to take the first step? Let’s get stuck into those tips so you can stop wondering “will I get accepted for car finance”.

How you can check and improve your credit score

Your credit score is the financial equivalent of your driving record. A few bumps? Sure, they happen. But lenders might think twice if your score looks like the aftermath of a demolition derby.

Credit scores typically range from 0 to 999 in the UK, depending on the credit reference agency (CRA) running the check. A score above 700 is considered good, while anything below 500 could mean extra hoops to jump through.

Not sure where you stand? Checking your credit score is simple. Services like ClearScore and credit agencies like Experian let you peek under the bonnet for free.

If you do have a rough idea of your credit score, or you just want to play around with different car finance eligibility scenarios, plug your details into our car finance calculator. It’s a nifty tool that gives you a no-strings-attached estimate of what you could borrow.

Want to give your credit score a bit of extra horsepower? Here’s the blueprint:

Get on the electoral roll – Registering to vote is an easy way to improve your credentials with lenders.

Pay bills on time – Late payments leave marks lenders don’t love. Treat your bills like a pit stop – timing is everything. For example, paying a utility bill a week late might not feel catastrophic at the time, but it could knock a few hard-earned points off your score. This could ultimately mean the difference between approval and rejection.

Trim unused credit cards – A wallet full of credit cards isn’t impressive to lenders. It’s nerve-wracking to them. Keep the essentials and ditch the rest.

Dispute errors – If your credit report’s showing dents that aren’t yours, get them polished off. Every point counts towards car finance eligibility.

Save for a bigger deposit

The maths is simple for this one. Bigger deposits = happy lenders.

Am I eligible for car finance if my credit score is lacking? Yes, and a hefty deposit can help win over lenders. For example, a 20% deposit compared to 10% says, “Hey, I’m serious about this” and ready to commit. Beefing up your down payment can often lead to better deals and lower monthly payments.

Start by tracking your monthly expenses and cutting out non-essentials. Skipping your daily takeaway coffee might feel negligible but over six months, it could add up to a significant boost to your deposit.

Padding out your deposit isn’t just about strengthening your car finance eligibility. A larger down payment reduces the total amount you need to borrow. This means you’ll pay less interest over the life of the loan.

But what if you’re in a rush? Here’s a tip – consider a more affordable car. That way, your saved-up deposit goes further, and you’re still motoring in style. Just maybe not in a brand-new coupe… for now.

Avoid applying to multiple lenders simultaneously

Scattergun applications? That’s a hard pass.

Applying for finance with every lender under the sun might seem like a good idea. Especially if terms like ‘guaranteed car finance’ are dangled in front of you. But here’s the thing. It’s not. Every application adds a hard search to your credit report which lenders can see. Too many at once can make you look desperate for borrowed cash.

Let’s say you apply to five lenders in a month. Each one leaves a mark on your credit report and when the sixth lender sees this, they might think, ‘Why didn’t the others say yes?’ Suddenly, you’ve got a problem.

My Car Credit simplifies this. We do the legwork and submit applications on your behalf without turning your credit score into Swiss cheese. We also go the extra mile to match you with the best options for your unique situation, without the credit score bruising that comes from multiple applications.

What does this mean for motorists like you wondering will I get accepted for car finance? Less hassle, no damage to your credit score and a higher chance of getting the deal you want.

Be honest about your financial situation

Honesty is the best policy when applying for car finance. You wouldn’t claim your Fiat Panda can outpace a Bugatti, so don’t overstate your income or underplay your expenses. Lenders are smart and fibbing will only slow you down. Or worse, derail the whole process.

Am I eligible for car finance if my finances aren’t in great shape? High street banks might not approve your application, but you might be pleasantly surprised with the response from alternative lenders.

The bottom line? Be transparent. No smoke, no mirrors. It works both ways. Being upfront about your situation helps lenders tailor a deal that works for you.

Your next step to a stronger car finance application

Improving your eligibility for car finance isn’t just about meeting the minimum requirements. It’s about doing everything you can to unlock better options. The right preparation now could mean cruising into approval instead of idling in uncertainty.

Ready to fast-track your way to car ownership? At My Car Credit, we’re here to help boost your eligibility for car finance and get you behind the wheel. Apply now and let us help you secure a finance deal that works for you, no matter what your financial history.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

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Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

car finance car finance calculator car finance eligibility eligibility for car finance

Tips for Securing Affordable Used Car Finance Monthly Payments

A bit of strategic thinking goes a long way when it comes to keeping monthly car payments manageable. Financing used cars is a great start but it’s not the only way to save. Here’s a mix of tried-and-true methods and lesser-known hacks to help you lock in affordable monthly payments while still securing the car you need.

Why Buying a Used Car Can Be the Smart Choice

No surprises here – keeping monthly payments affordable is usually a top priority for Brits interested in car finance for used cars. After all, your budget needs to cover more than just the vehicle itself. It has to balance against rent, bills and the unexpected costs that come with day-to-day life. Not to mention the costs associated with car ownership in general.

Buying used can make a lot of sense when monthly payments are a priority. Why? Lots of reasons.

Used cars are priced lower than new models which makes it easier to find finance terms that fit within a realistic budget. Even better, they’ve already bypassed the dreaded depreciation phase. Just how bad is depreciation? A new car can lose around 20% of its value within the first year. In comparison, a used car has already absorbed most of this hit. Financing a used car means you’re essentially paying closer to the vehicle’s real, lasting value. This translates to a better deal over the life of your loan.

Wondering if used cars can be purchased on finance? Absolutely.

Finding the right used car finance plan can make all the difference and allow you to enjoy car ownership without stretching yourself too thin. This is exactly what we specialise in at My Car Credit. We ditch the cookie-cutter method and use a personalised approach to help you find the right finance plan. A tailored plan can be the difference between struggling with payments and owning a car that feels right at home in your budget.

Understand Your Budget Before Applying

Select your weapon of choice – your smartphone’s budgeting app, a simple spreadsheet or good old-fashioned pen and paper – and get real about your budget. You want to find out how much can you spend each month without tightening your belt too many notches.

Start with the essentials – rent, bills, groceries and whatever else keeps your household running. What’s left over? That’s your baseline for a comfortable car finance payment for used cars.

If you’re the number-crunching type – or if maths just isn’t your thing – the My Car Credit’s affordability calculator has your back. It helps you plug in your numbers and get a realistic look at what fits.

Poor Credit? Not to Worry

Maybe your credit history’s not sparkling? Join the club. Poor credit doesn’t mean you can’t finance a used car. It just means you might need a slightly different playbook. Sure, you could see higher interest rates, but affordable monthly payments aren’t off the table.

Good lenders will look beyond your credit score and consider factors like steady income and a decent deposit, to gauge the bigger picture. Some plans are built with flexibility in mind for people in this exact situation. This makes it possible to balance your car payments alongside everything else life throws your way.

Curious what’s possible with your situation? Use the My Car Credit affordability calculator to get a tailored view of what’s realistic. When you have your figure you can start the fun part – looking for a used car to finance!

Consider a Larger Deposit to Lower Monthly Payments

Got some cash stashed away? Using it to pay down a chunk of your car finance deal can be a smart move. A larger deposit lowers the amount you’ll need to borrow and as a result, shrinks your monthly payments. Plus, it earns you a big, shiny gold star with lenders.

The best part? You’ll continue to enjoy the benefits month after month, for the duration of your contract.

Want to see the impact? Try adjusting the deposit amount in My Car Credit’s finance calculator and watch how those monthly payments respond. You’ll likely find that even a small boost can ease the financial pressure and give you some breathing room.

Looking for a deal that fits your budget? Our team is here to help you find an auto finance agreement that works for you. Get in touch with an advisor today to chat about options for financing used cars.

Opt for a Longer Finance Term

Maybe a big deposit isn’t on the cards right now. If this is the case, it might be worth extending your finance term. By spreading the loan over a longer period, you can lower each monthly payment and make your loan easier to manage.

But there’s a trade-off. A longer term means you’ll pay more interest overall. It’s not necessarily a bad thing, if your priority is getting your monthly payments as low as possible. But it’s something to be aware of with car finance for used cars.

The key is finding a term that doesn’t stretch your budget now or hit you too hard in the long run.

Improve Your Credit Score for Better Terms

Down to play a longer game? Let’s talk about credit scores.

They have their quirks, but there’s no doubt they impact what you’ll pay in interest when financing used cars. A higher score generally unlocks lower interest rates, which brings down your monthly payments. If you’re not in a rush, take a few months to tidy up your credit. Small changes can make a big difference so don’t underestimate the potential.

The below tips aren’t just effective but are easy to action:

Clear up any lingering debts – High-interest debts (especially credit cards) are worth tackling first. And regular bill payments are non-negotiable if you want to keep that score healthy.
Skip new credit applications for now – Each application can give your score a bit of a ding, so it’s best to avoid new credit in the months leading up to your car finance application.
Stay on top of your current accounts – It sounds obvious, but consistent, timely payments on your existing accounts can build your score bit by bit.
Join the electoral roll – This one’s a quick win. Registering to vote in the UK is a simple way to boost your credit score. Lenders look for stability and being on the electoral roll helps verify your identity and ultimately, add a bit more weight to your credit profile.
Keep credit utilisation low – Aim to use only a small portion of your available credit. For instance, if you have a credit limit of £1,000, try to keep your balance below £300. This shows lenders you’re not maxing out your accounts.
Regularly check your credit report – Errors do happen. Reviewing your report every few months can help you spot and dispute any inaccuracies. We’re talking anything from outdated information to mistaken identities. It’s also a good way to keep an eye on anything that might need attention.

The goal is to make your credit profile look as healthy as possible, so you qualify for better finance terms when financing used cars. If you’re interested in more tips, check out our guide to improving your credit.

Choose a Car That Fits Your Budget

The car itself is a big factor when it comes to monthly payments. It’s easy to be tempted by hyped models like the revamped Tesla Model Y and Mini Aceman all-electric crossover SUV. But if affordable payments are your goal, buying second-hand can be a practical move.

Looking for a used car to finance? The UK market is packed with options that balance value and reliability. Ford Fiesta, Nissan Qashqai and Renault Clio – These aren’t just bestselling models (though their popularity does ensure there’s plenty of stock on the second-hand market). Used models all promise solid performance without draining your wallet.

Our advice? Do your homework, shop around and you’ll find a used car to finance that ticks all your boxes.

Get Personalised Support With the My Car Credit Team

Financing a used car doesn’t have to be a solo mission. And it certainly doesn’t have to be stressful. At My Car Credit, our team is here to guide you through the ins and outs of securing a finance plan that fits your budget. Whether it’s deciding on a deposit amount, weighing the pros and cons of different terms or figuring out what car fits best, we’re here to help you with personalised advice, every step of the way.

Ready to drive your next car on your terms? Start with our online application. It only takes a few minutes, and it’s designed to keep things simple so you can get behind the wheel faster.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

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Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

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Small Splendour: What’s the Best Luxury Hatchback?

Who says you need a huge SUV or a spacious saloon to enjoy a bit of luxury on the road? If you’re after a car that’s big on style but small enough to zip around tight city streets or squeeze down narrow country lanes, you’ll love our roundup of the best luxury hatchback models. Loaded with high-end features, these little gems prove that good things really do come in small packages.

Mini Cooper S

When it comes to luxury hatchbacks, the Mini Cooper S is as British as a cuppa. The iconic design is just the beginning. Behind the wheel, you’ll enjoy nimble handling and an extraordinarily good turning circle that’s perfect for city driving.

Worried about power? Don’t be fooled by its compact size. The Mini Cooper S packs a punch with a 2-litre four-cylinder engine that delivers plenty of oomph on the open road.

The stylish cabin is what makes the Mini Cooper S one of the best luxury hatchback models. Expect premium materials, a slick infotainment system and retro touches to make you feel like you’re driving a piece of British motoring history.

Mercedes-Benz A-Class

The Mercedes-Benz A-Class is exactly as the brand promises – a “benchmark for modern luxury in the compact class”. It’s got all the elegance you’d expect from the iconic German brand, but with the practicality of a hatchback.

The sleek, aerodynamic design looks just as good parked outside a fancy restaurant as it does in your driveway. Inside is a dual-screen setup with a digital instrument cluster and large infotainment display, both controlled by Mercedes’ state-of-the-art MBUX system. It’s as high-tech as it gets.

Power isn’t an issue thanks to a range of engine options, including petrol, diesel and hybrid options.

Accelerate from 0 to 62 mph in 7.4 seconds
Up to 215 hp output
Top speed of 140 mph

BMW 1 Series

The BMW 1 Series delivers the brand’s trademark driving experience in a more compact package. Sporty performance is front and centre – and it all starts with the rear-wheel-drive setup. The unique configuration means the driving experience is far more dynamic than many other hatchbacks in its class.

The cabin is both luxurious and driver-focused, with designers championing high-quality materials, intuitive controls and of course, BMW’s iDrive infotainment system.

Lexus CT

Luxury meets low emissions in the Lexus CT. This is one of the best luxury hatchback hybrids and features a serene cabin crafted with butter-soft NuLuxe pleather. Under the hood is a hybrid powertrain that delivers impressive fuel economy without compromising on performance. If you’re looking for a hatchback that’s big on power but gentle on the environment the CT meets the brief.

Finance your luxury hatchback

From the iconic Mini Cooper S to the sporty BMW 1 Series, luxury hatchbacks prove that you don’t need a Chelsea tractor to enjoy a premium driving experience.

Want to know more about luxury car finance for the best luxury hatchback models? Try our free Car finance Calculator today and get on the road to your next luxury hatchback.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

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Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

car buying car finance Hatchback Jan24 luxury nearly new used car

What to Look for in a Car Loan Quote

Most UK drivers just don’t have the cash to pay for a car upfront.

That’s where car finance comes in. Car finance is a catch-all term referring to a type of credit agreement. With car finance, you’ll borrow a pre-agreed amount of money from a lender. You then use this cash to purchase a vehicle and pay the loan back through a series of affordable monthly repayments, plus interest.

Car finance is an affordable, accessible, and flexible way to get behind the wheel of your dream car. In this article, we’ll examine what to look for in a car loan quote.

6 things to look for in a car loan quote

When shopping around for a car loan quote, you’ll likely come across a lot of jargon. You can use our car finance jargon buster to break down the kinds of terms that you might face in your search.

APR

An abbreviation of annual percentage rate, an APR refers to the full cost of your annual borrowing for a car loan. The higher the APR, the more you’ll pay overall.

An APR differs from an interest rate because it includes all standard fees and charges, as well as any interest you’ll be expected to pay. Therefore, it gives you an indication of the true cost of your car finance.

The APR must be disclosed before an agreement is signed, so you should always check this out when shopping for a car loan quote.

Comparing the APR offered by different lenders is a good way to compare car finance deals. Remember that the representative APR advertised is a benchmark – not all borrowers will receive it, so you need to check the APR that you’re offered.

Type of finance agreement

When shopping around for a car loan quote, consider what kind of car finance might best suit you.

One of car finance’s main draws for motorists is its flexibility. Different types of car finance agreements are available to suit different drivers.

Not all finance packages will work for everyone: your unique circumstances and needs will determine the right type of car loan quote.

Remember that the length of the loan term will also impact how much you pay in interest. The longer the term, the more you’ll pay back.

Any conditions or terms of the agreement

Different drivers have different priorities, so don’t opt for a ‘one-size-fits-all’ car loan quote.

Some motorists may be happy with mileage restrictions. Others might want to own the car outright, whilst some drivers are happy with the option to own the vehicle at the end of the agreement, or even to hand it back. Alternatively, you can find agreements which don’t require a deposit. It’s also worth knowing that you can face fines with some car finance agreements if you cause undue wear and tear on the vehicle.

When you’re looking for the right car loan quote for you, be realistic about your needs and circumstances, as well as the kinds of terms that will work for you. For example, if your work requires you to make long journeys frequently, choosing a car finance agreement with mileage restrictions may not be suitable.

Poor credit car finance

If you’ve got a poor credit score, you may not be eligible for certain car loan quotes.

Look for a lender like My Car Credit. We offer poor credit car finance to drivers with less-than-perfect credit scores. We combine a wide panel of trusted lenders with a sensible approach to help you get approved for a finance agreement that works for your circumstances.

Used car finance

Purchasing a ‘new to you’ vehicle is a great way of getting on the road without forking out for the sizeable outlay of a more recent car make and model.

If you’re looking for a car loan quote for a used or nearly new vehicle, check if your lender has used car finance available.

There are plenty of options for financing a used or nearly new car, with different agreements available to suit your unique situation and preferences.

Plus, if you’re looking for both your car and car finance in one go, check out if your lender or broker can help you with both. At My Car Credit, we’ve established excellent relationships with a large number of reputable car dealers across the UK, helping you to source your next nearly new car and car finance in one go.

Reputability and size of lender

It goes without saying that you should always establish the reputation of any lender offering you a car loan quote before signing a contract.

At My Car Credit, we’re part of the UK’s largest motor finance broker, Evolution Funding. This gives us access to the largest panel of car loan companies, meaning you’re more likely to find a car finance deal that suits your circumstances.

We’ve also got a friendly and experienced team of Car Credit Specialists who can offer any advice and guidance that you need throughout the process.

Plus, we’re also the ‘Best Broker’ winner for the ninth year running at the Car Finance Awards 2024, so you know you’re in good hands.

Find a car loan quote to suit you today

My Car Credit is dedicated to helping you find the best car loan quote for your needs and circumstances.

We pride ourselves on our speedy, hassle-free online application process. With us, you’ll receive a no-obligation quote in minutes, and any rate you see is the rate you get.

Do the maths today with our free online car finance calculator and get on the road to your next car.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

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How to Refinance a PCP Balloon Payment

5 Different Ways to Pay for a Car

Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

car finance car finance calculator car finance options car loan Jan24 used car

Best Cars to Learn to Drive In

From clutch control and parallel parking to basic road rules and motorway etiquette, there’s a lot to learn when getting behind the wheel for the first time. A good teacher is a must but what many young motorists don’t realise is that the car can also have a big impact on your driving experience. That’s why we’ve put together a roundup of the best cars to learn to drive in.

Whether you’re a brand-new driver or a parent on the search for the best cars for teenagers, this guide spotlights vehicles that are easy to handle, reliable and affordable – a winning trifecta in our opinion! We’ve included new models for 2024 as well as popular used options. And yes, you’ll see both manual and automatic cars on the list.

1. Ford Fiesta

New Price: £19,000 – £23,000
Used Price: £5,000 – £10,000

When it comes to staying power it’s hard to beat the Ford Fiesta. It’s a firm favourite among learner drivers in the UK, and for good reason. As well as being compact and easy to manoeuvre, it’s packed with best-in-class safety features. This is exactly what you want when you’re learning to drive.

2. Volkswagen Polo

New Price: £20,000 – £24,000
Used Price: £6,000 – £12,000

The Volkswagen Polo is hands down one of the best cars to learn to drive in. Known for its quality construction and reliable engine, the Polo promises comfort and safety. The well-designed interior boasts intuitive controls while the car’s compact size makes navigating city streets a breeze. Like the Ford Fiesta, the Volkswagen Polo is available in both manual and automatic, offering lots of flexibility for learners.

3. Toyota Yaris

New Price: £21,000 – £25,000
Used Price: £7,000 – £13,000

Looking for a learner-friendly hybrid? The Toyota Yaris is a great pick for eco-conscious new drivers. Its compact size delivers excellent fuel economy while a suite of safety features, including automatic emergency braking, offer peace of mind for learner drivers (and their teachers riding shotgun!).

4. Kia Picanto

New Price: £13,000 – £17,000
Used Price: £4,000 – £8,000

Built for urban driving, the Kia Picanto is a terrific budget-friendly option for beginners. It’s one of the more affordable cars to learn to drive in but certainly doesn’t skimp on quality or performance.

5. Hyundai i10

New Price: £15,000 – £18,000
Used Price: £4,000 – £9,000

The Hyundai i10 is a small car that offers big value. It’s affordable, easy to drive and comes with all kinds of optional extras. Think alloy wheels, LED daytime running lights, smart key technology, heated front seats, privacy glass and more. Talk about luxury for less! The compact size and easy-to-handle steering make it a breeze to drive and park – a big plus for learners who might be nervous behind the wheel.

6. Vauxhall Corsa

New Price: £18,000 – £22,000
Used Price: £5,000 – £10,000

With low running costs and responsive handling, it’s easy to see why the Vauxhall Corsa is one of the best cars to learn to drive in. The model is available in both manual and automatic, with newer versions built with petrol, hybrid or fully electric engines. Modern tech features like touchscreen infotainment systems make it easy to run Google Maps, crank Dua Lipa and stay connected on the go.

7. Renault Clio

New Price: £19,000 – £23,000
Used Price: £5,000 – £10,000

This much-loved French supermini is a stylish choice for new drivers. The high-quality interior feels luxurious and efficient engines keep running costs low. It’s also surprisingly spacious for a small car.

8. Mini Hatchback

New Price: £22,000 – £28,000
Used Price: £6,000 – £12,000

If it’s good enough for Kate Moss, it’s good enough for learner drivers! The Mini Hatchback is a British icon and perfect if you want to inject a bit of fun into your driving lessons. Agile handling is just the beginning… The car has a premium feel and despite its compact size, feels quite spacious inside.

9. Fiat 500

New Price: £16,000 – £20,000
Used Price: £4,000 – £8,000

What’s not to love about a little Italian flair when you’re learning to drive? Going strong since 1957, the model is widely considered the first ‘city car’ and set a new benchmark for compact design. New generation models are fun to customise, but you’ll also find great deals on the used market.

10. Honda Jazz

New Price: £21,000 – £25,000
Used Price: £6,000 – £12,000

A little bigger than some of the options on this list of the best cars to learn to drive in, the Honda Jazz promises space and versatility. A high driving position promises excellent visibility and helps boost the confidence of new drivers.

Why these cars are ideal for learning to drive?

Easy to handle and manoeuvre

The last thing you need when learning to drive is a car that’s tough to handle. All the models mentioned above are known for their easy manoeuvrability, making them ideal for newbies who are still building their confidence behind the wheel.

Great safety features

New drivers benefit enormously from cars with modern safety features. From automatic emergency braking and lane departure warnings to multiple airbags, the cars in our roundup all perform exceptionally when it comes to safety.

Affordable

Even new, the cars mentioned above offer unbeatable value for money. And let’s face it, affordability is a big priority for most new drivers. Even better, all models boast lower running costs, another plus for budget-conscious learners.

Learn in style with My Car Credit

Whether you opt for a brand-new set of wheels or a reliable used model, the right car can significantly enhance the learning experience for new drivers. The key to finding the best cars to learn to drive in? Picking a vehicle that offers a good balance of safety, affordability and ease of use. When you’ve settled on a favourite, My Car Credit is here to help you secure the keys with car finance advice for young drivers.

Try our car finance calculator and see how My Car Credit can get you into the driver’s seat.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

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Loan amount

£

Repayment term

My credit rating

X monthly repayments of
^£X

Typical rate

Loan amount

Total payable

X% APR*

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

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!

or call 01246 458 810

budget car buying car finance Jan24 nearly new used car

Understanding the three main car finance types

How does PCP work?

How PCP works

Advantages of PCP

Disadvantages of PCP

How does HP work?

How HP works

Advantages of HP

Disadvantages of HP

How does leasing work?

How leasing works

Advantages of leasing

Disadvantages of leasing

PCP vs HP vs leasing: Side-by-side comparison

Quick takeaway:

PCP vs HP vs leasing: Which is best for you?

Best for flexibility: PCP

Best for ownership: HP

Best for low monthly cost & convenience: Leasing

Key things to consider before choosing a finance option

1. How long do you plan to keep the car?

2. How much do you drive?

3. What’s your budget?

4. How important is ownership to you?

5. What’s your credit situation?

Why choose My Car Credit for your car finance?

PCP vs HP vs leasing: FAQs

Is leasing cheaper than PCP or HP?

Can I buy the car after a lease ends?

Which is better for bad credit: PCP or HP?

Do PCP or HP agreements include insurance?

Can I end a PCP, HP or lease early?

Does leasing affect my credit score?

Rates from 9.9% APR. Representative APR 10.9%

Related articles

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Accidents happen – but if your car on finance is written off, you’ll need to take immediate steps to ensure that all relevant parties are informed. These parties include your insurer, the lender and the DVLA.

What does ‘written off’ mean for a car on finance?

Who owns a car on finance if it’s written off?

What happens if you crash a car on finance with insurance?

What happens if you crash a financed car without insurance?

What if the accident wasn’t my fault?

Do you still have to pay finance after a write-off?

What is GAP insurance and how does it help?

Step-by-step: what to do if your financed car is written off?

Moving forward after a car write-off

FAQs about what happens if you crash a car on finance

What happens if I crash a financed car and it’s my fault?

What if my financed car is written off and I still owe money?

Can I get another car on finance after a write-off?

What if my car on finance with a provisional licence is written off?

Will a write-off affect my credit score?

Can I transfer my finance to another car?

Rates from 9.9% APR. Representative APR 10.9%

Related articles

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Require more help?

What is a car finance broker?

Brokers vs. lenders: know the difference

Unlock finance options dealers can’t always match

Why Use a Car Finance Broker – Top Benefits

Wider choice of lenders

Soft credit search to start

Less paperwork, faster process

Expert help and ongoing support

Better approval odds for complex applications

When should you consider using a car finance broker?

How the car finance broker process works

Apply for car finance with My Car Credit

Common questions about car finance brokers

Do car finance brokers charge a fee?