Where to get car finance

Apply online or accept the APR rate from a dealership? The guide on where to get finance and which option is best for you

BuyaCar team
Jan 14, 2019

If you’re buying a car from a retailer or dealership, then you’ll probably be offered finance at the same time.

But there’s no need to accept the dealership's offer immediately. In fact, it often pays to shop around and compare rates because you can still buy the car that you want while arranging finance somewhere else.

That's also the case with BuyaCar: there's no obligation to use our finance, but we do work with a panel of lenders to ensure we can offer competitive rates.

If you’re changing cars, there’s no need to go back to the same dealership or retailer: any professional car seller should be able to handle the end of a finance agreement and switch you to a new agreement on another car.

Wherever you look for finance, it's easy to compare quotes because lenders can carry out a “soft-search” that provides you with an estimated quote without making a mark on your credit history.

Every quote should include an APR figure. This is the cost of finance - a proportion of the total amount you borrow - which includes interest and fees. It's calculated in a standard way so you can compare deals. Quotes should also include the total amount payable for the entire agreement, which is another standard way of comparing them.

Where to get finance


Companies such as BuyaCar often use a panel of lenders to get the best quote for a particular borrower and vehicle. By using a finance firm that's best for your situation, you'll normally get a competitive quote.

A full range of car finance is usually available, including Hire Purchase (HP), which spreads the full cost of the car into a series of monthly instalments. At the end, you own the car. Personal Contract Purchase (PCP) is also offered, with lower monthly payments that only cover part of the vehicle's cost. You can return it or buy it for an additional sum at the end.

As long as the price is right, then it makes sense to take out finance from the same place that you buy your car because it's convenient and there shouldn't be any communication delays.

Increasingly, ID verification and signatures can be completed online. This may mean that you won’t need to send in original documents or print and sign forms, although original documents may be required by some lenders.

Franchised dealership

If you're buying a brand new car on finance, then it’s likely that you'll get the best possible deal from a franchised dealership that’s linked to a manufacturer.

0% finance is often available. If not, then the rate is likely to be subsidised by the manufacturer, so you could be paying an extremely low interest rate as well as benefiting from deposit contributions that reduce the amount that you have to repay.

PCP and HP finance are typically available, as is leasing (long-term car rental). You can get these deals by visiting a dealership in person but it’s also possible to configure and order a car online, making it easy to compare offers between different dealerships.

If you’re looking for a used car, then you’ll probably find that the attractive finance rates disappear, along with the option of leasing. In general, used car finance at franchised dealerships is not as competitive as the rates available for new cars.

That’s why it can pay to arrange finance elsewhere, from a bank, finance broker or site such as BuyaCar. You may benefit from a lower rate, while buying the car that you want.

Independent dealership

Before going into an independent dealership, it’s worth doing your homework as they generally have higher interest rates compared to what you’ll find elsewhere.

But, there’s nothing stopping you from arranging your own PCP or HP finance, and using it to buy from an independent dealership. You might be able to save around £1,000, depending on the price of the car and the interest rates available.

Banks, finance brokers, and sites such as BuyaCar all offer finance that can be used to buy a car in person.

Separate finance broker

Credit brokers typically work with a range of lenders, offering different interest rates for various circumstances. This means that there’s a good chance that they can offer a competitive rate for your particular car, based on your credit profile.

BuyaCar offers this service, as do a number of other brokers, making it easy to compare rates and apply for the cheapest deal. 

Bank loan

Bank loans offer straightforward credit. You borrow an amount of money and then repay this with fixed monthly payments. It’s easy to compare

This does mean that the flexibility and low payments of PCP finance aren’t available.

The loan isn’t secured on your car either, which may reduce the amount of credit that’s available to you elsewhere.


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