Unfortunately, every car loan is tailored to your individual circumstances and the vehicle you’ve financed so you can’t just transfer a car loan from one car to another.
But that doesn’t mean you’re stuck with a car you no longer want or can’t afford. You do have options, even if you haven’t yet reached the end of your agreement.
Pay the settlement figure
If you’d like to settle your finance early and own or sell your car, you can request a settlement figure from your lender. Typically, the further you are into your finance agreement, the lower this figure will be. Once you’ve settled your finance, you’ll be free to do what you like with the car: keep it, sell it or part-exchange it to use as a deposit in a new agreement.
Refinance my car
Want to change your agreement but keep your car? You can look to refinance instead.
When your finance agreement can last anything up to seven years, it’s understandable that your circumstances can change. If you need to reduce your monthly outgoings or your financial situation has improved over time, a refinance deal could work for you.
Refinancing is when you look for a new finance agreement (usually with a new lender) to pay off your existing loan amount with a better interest rate or lower monthly repayments. You’ll settle your existing finance with a one-off payment, which will be covered by the new lender or incorporated into your new lender.
But keep in mind that switching to a loan with lower repayments might not be the best choice long-term. Take note of the total amount payable on the new loan and be aware that having lower monthly payments over a longer loan term could mean you pay back more overall.
What about negative equity?
If your car is currently worth less than the outstanding finance, then you’re in negative equity. But you don’t have to be stuck there! Here at CarFinance 247, we work with a panel of lenders and some can offer negative equity car finance. With these loans, you can combine the cost of clearing your negative equity and the price of a new car into one affordable monthly payment.