Customer Stories

Student car finance generally works the same as any other car finance. You borrow money from a lender to cover the cost of a new or used car and then pay it back in more manageable monthly repayments. There are several types of loan available and car finance is the catch-all term used to describe them.

You’ll need to know how much you want to borrow and how long you want to borrow it for (the loan term) to find the car finance deal that’s right for you. You could also put down a deposit to reduce the total loan amount. If your loan is approved and you decide to proceed, you’ll then pay it back in monthly instalments, plus interest, for the duration of the loan term, which typically lasts between one and five years. Depending on the deal you choose, your finance might be secured against the car.

There are several types of car finance students could choose from but the most common are Hire Purchase (HP) and Personal Contract Purchase (PCP).

Hire Purchase: The loan is secured against the car and you won’t own it until you’ve reached the end of your agreement and paid the ‘Option to Purchase’ fee. You might need to put down a deposit but it’s unlikely that you’ll have to agree to any mileage restrictions.

Personal Contract Purchase: Loans are also secured against the vehicle, but you don’t automatically own the car when the loan term ends. Instead, you can choose to give it back, use any positive equity as a deposit in a new deal, or buy the car by paying the balloon payment. Monthly payments could be lower than with HP car finance, but you may have to agree to annual mileage limits.

Deciding on the best car finance option for you will depend on your individual circumstances, the car you want to buy, and how you want to use it.

With Hire Purchase (HP) finance, you’ll own the car at the end of your loan term, but your monthly repayments might be higher than other options and you won’t be able to sell or change the car during your agreement.

Personal Contract Purchase (PCP) car finance could offer the lowest monthly repayments, but you may have to agree to mileage restrictions, and you won’t automatically own the car at the end of the loan term. At the end of the term you can decide whether you want to return the car, or pay the final balloon payment to keep the car.

No matter which financing option you choose, at Car Finance 247, we’ll always look to try and find you the best deal from our panel of lenders.

The cheapest way to finance a car depends on a few factors including the type of loan you have, the loan length, and the APR. Keep in mind that the loan that offers the lowest monthly repayment might not be the cheapest deal as you could end up paying back more in interest over time.

PCP car finance may be more expensive overall, but monthly payments may be cheaper than HP or a personal loan as you don’t have to borrow the full amount your vehicle is worth. Instead, you’ll borrow the difference between the price now and the amount the lender thinks your car will be worth at the end of your agreement – the Guaranteed Future Value (GFV). But remember, you won’t own the car at the end of your loan unless you choose to pay the balloon payment.

When you apply with Car Finance 247, there is no impact on your credit score. We use a soft search to give you a quote. If you proceed, a hard search will be conducted which may impact your credit score.

Yes! You can use the car finance calculator to get an estimate of your monthly repayments based on the amount you’d like to borrow, the loan term length, and your credit score boundary. We also have a car refinance calculator.

To apply for car finance with us, there are a few key requirements you'll need to meet.

Most lenders typically ask for the following:

1. Age: You must be aged 18 or over to apply. 
2. UK Residency: You must have lived in the UK for the last three years or more. This helps us confirm your identity and check your eligibility for credit.
3. Valid driving licence: You’ll need to hold a UK provisional or full driving licence to show you’re legally allowed to drive a vehicle.
4. Proof of income: If you choose to proceed, some lenders may ask for recent payslips or benefit statements to check affordability. 

Visit our guides to understand what documents you need for car finance and what lenders look for when approving car finance.

With Car Finance 247, you get a decision in minutes. Make an application, pop the kettle on, and you’ll have a decision by the time you’ve finished your tea. If we’ve found you an approval in principle, your dedicated account manager will give you a call to confirm your details and discuss the next steps.

The cost of car finance is typically defined as the amount of money you borrow plus the interest and any other charges that you’ll need to pay on the loan over the repayment term.

If you choose Hire Purchase (HP) car finance, your monthly repayments will cover a portion of the car finance and your interest payment. The interest rate that you’re offered depends on a few things including your credit score and improving your score which could give you access to better rates. Credit is subject to status.

If you know how much you’d like to borrow or have already found a car you’d like to buy, it’s time to apply. It all starts with a quote. Our online application form will ask you to enter some personal details, your current employment status, monthly income, and information about the vehicle you’re looking to buy so that we can get to work trying to find you an approval in principle from our panel of lenders.

Read our guide on what documents you need for car finance for more information.

Yes, we could accept part-exchanges.

A part-exchange acts as a deposit towards your new car. This would reduce your total loan amount, which means the amount you pay back each month is reduced too.

Having a part-exchange may sometimes help when it comes to likelihood of approval as it means a smaller loan amount is requested, which might open more options up to you. If you wanted to put a cash deposit down, we could accept these too!

We may be able to help customers that have been refused elsewhere.

If you've applied somewhere else (such as a bank, car dealership or even another car finance broker) and have been refused car finance, you might start to think that nobody can help. Some of the lenders we work with specialise in helping people with bad credit get car finance, so we'll try our best to find the right finance option for you. Credit is subject to status.

Working with a large panel of lenders means we could help customers with a range of credit histories to get car finance, and we have been able to help people with fair credit. We work with a wide panel of lenders, some of which consider customers with fair credit, so we'd be hopeful of being able to help you to get a competitive finance deal in place. Credit is subject to status.

Yes, you can choose a car from any verified UK dealership!

To make finding the right car easier, we've got over 95,000 cars for you to view on our car search. Once you've found a car, you just need to share the details with your account manager, and they'll do the rest.

You don't have to choose a car from our search and, if you need a hand finding the right car, your account manager will be happy to help - just let them know what you're looking for.

While no deposit car loans may be available, having a good deposit upfront reduces the amount you need to borrow. This could mean that you have lower monthly repayments or a shorter loan period. A good deposit is one that you can afford and still leaves you with funds to cover essentials like tax, insurance, and fuel. Typically, a car finance deposit of at least 10% of the total loan may be considered good.

Yes, you could repay a car loan early by paying the settlement figure. This is the amount you need to pay to end your finance agreement and typically includes any outstanding finance minus any future interest that you won’t need to pay. This could help you save money overall. Contact the lender to request a settlement figure and find out whether there are any early settlement fees to pay.

APR stands for Annual Percentage Rate and it represents the total annual cost of borrowing money including interest, admin fees, and any arrangement charges. APRs are tailored to your individual circumstances and the one that you’re offered depends on several factors including your credit score.

Getting a car on finance is worth it if it’s the best choice for you and your circumstances. If you have savings, buying a car outright could be the easiest and cheapest option if you plan to keep the same car for a long time and aren’t worried about depreciation over time. However, if you don’t have the money to pay for a car all in one go, would like to change the car regularly, or even hand it back after a few years then a car finance option like PCP could be the better choice for you.