From sidestepping initial depreciation to avoiding long waitlists, used cars come with myriad benefits.

Like new models, car loans can be a great way to fund the purchase of a second-hand vehicle. Even better, navigating the used car loan process doesn’t have to feel like manoeuvring a busy roundabout during rush hour. With the right information, securing finance for a used car can be straightforward and stress-free. Whether you’re eyeing a sturdy family estate or a compact city runner, read on for an easy, six-step guide to the used car loan process.

Step 1: Assess your financial situation

Before you kickstart your loan application, take a good look at your financial health. Crunch your numbers and decide how much you can afford to pay each month while maintaining a comfortable lifestyle and keeping up with other financial responsibilities. Don’t forget to include other car-related expenses such as insurance, maintenance, and fuel.

It’s worth checking your credit score, which will play a significant role in the terms you might receive and your interest rate. A higher credit score can unlock more favourable loan conditions.

Step 2: Choose the right vehicle

Be mindful that your choice of vehicle can influence your loan terms and overall chance of approval. Older models or cars with high mileage might be harder to finance as they’re considered less reliable. Settling on a few options before approaching lenders can help streamline the used car loan process.

Step 3: Shop around for the best deals

Don’t accept the first loan offer you receive, even if it seems like a great deal. Compare rates from different lenders, including high street banks, credit unions and specialised auto finance companies. Working with a broker can be a great way to expand your horizons and shop around for the best deals when navigating the used car loan process.

Step 4: Understand the terms

It’s important to understand all the terms and conditions of your loan. Look beyond monthly payments and evaluate variables like interest rate, loan duration and any fees associated with early repayment or late payments.

Longer loan terms can make monthly repayments more affordable, but it’s important to remember that you’ll be making more payments and, therefore, paying more interest over time. Assess whether a longer car finance term is truly beneficial for you in the long run. To put things into perspective, the latest data from Experian reveals the average auto loan term for used cars is 67.4 months, while average car leases are just under 36 months.

Step 5: Finalise the loan and purchase your car

After choosing the best loan offer, it’s time to submit your paperwork. This typically involves providing proof of income, identity, and other key documents. Once the loan is approved, the funds are transferred directly to the dealership or your personal bank account, dependent on the type of agreement. You can then purchase your used car and get behind the wheel!

Step 6: Repayment and beyond

With the loan secured and the car keys in hand, focus shifts to repayments. Setting up automatic debits during the used car loan process can help avoid missed payments and potential fees. Consider making extra payments to reduce the interest amount and shorten the loan term.

Check out our fantastic online car finance calculator today to discover the right car finance for you.

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!