Making Car Financing Decisions Easier
Hi there! I'm Jamie, and I've been writing about UK personal finance for over six years. After helping countless readers navigate car purchases, I built this calculator to give you clear, transparent numbers before you make one of your biggest financial commitments.
This tool doesn't just spit out numbers—it helps you understand why your payments are what they are, and how different choices affect your budget. Whether you're eyeing a new family car or a used runabout, knowing your numbers is the first step to smart financing.
Enter Your Loan Details
Tip: A larger deposit reduces your loan amount and interest costs
Your Payment Breakdown
Updated in real-time as you adjust
Cost Breakdown
Smart Auto Financing Tips from Experience
Check Your Credit First
Your credit score dramatically affects your interest rate. Check it for free through ClearScore or Experian before applying.
Consider Total Cost
Look beyond monthly payments. A longer term means lower payments but more interest overall. Use this calculator to compare.
Shop Around
Don't just accept dealer finance. Compare rates from banks, credit unions, and online lenders for the best deal.
Factor in Running Costs
Remember insurance, road tax, fuel, and maintenance. These often add 20-30% to your monthly car expenditure.
Frequently Asked Questions
This calculator uses standard amortization formulas that lenders use for fixed-rate auto loans. The results are accurate for estimation purposes, but actual lender offers may vary slightly based on your credit profile and specific lender policies. I've designed it to be as precise as possible based on my six years of financial writing experience.
As of 2024, rates typically range from 3% (excellent credit) to 15% (challenged credit). Most buyers with good credit secure rates between 5-8%. Remember, electric vehicles often qualify for better rates, and dealership promotions can sometimes offer 0% or very low rates on specific models.
Shorter terms (24-36 months) mean higher monthly payments but significantly less interest paid overall. Longer terms (60-72 months) lower monthly payments but increase total cost. I generally recommend terms no longer than 48 months to avoid negative equity (owing more than the car's value).
Beyond your loan payment, budget for: insurance (£50-£150/month), road tax (£0-£30/month), fuel (£100-£200/month), servicing (£20-£50/month), and unexpected repairs. A good rule is to add 25-40% to your loan payment for total car ownership costs.
Most UK auto loans allow early repayment, but check for early settlement fees. Some lenders charge 1-2 months' interest if you pay off early. Always ask about this before signing. Early repayment can save you significant interest if you come into extra funds.