Car Finance
admin July 21, 2022

There’s a lot going on.

It is not just usual day-to-day financing or investment. It is but the car financing norms, and we need to learn about that a little before making the car set its wheels in motion.

As a matter of fact, we have to understand that there are things related to a car which we need to know before making a purchase.

It is because a car has quite a good price tag associated with it. And that is because it is a sophisticated piece of machinery.

But more than that, the presence of state rules and regulations makes it mandatory for the buyer t go through financial details regarding the ownership of a car.

Although it is a vehicle you can purchase anytime, it is better if you make some studies about it beforehand as we have some finance schemes related to buying a car as well.

Before that, we will learn about the basic idea of car finance.

What Is Car Finance Anyway?

If you check our car finance page, you will find that we have put the central meaning of car finance in it.

Put plainly, and a car finance option is a financial plan or scheme that you use to own or rent a vehicle. In the economic sphere, the presence of direct lenders makes a difference as car loans or automotive lending constitute a huge part of car financing in this age.

But that is something we will learn later.

While suggesting our borrowers' packages on very bad credit car finance scores, we always ask them to make an analysis of the cars they want to buy because that is required essentially.

We tell them to focus on three things:

1 - The  type of vehicle and its real economic value

2 - Car Finance Schemes in the UK

3 - Car Loans in the UK

Apart from that, we have smart browsing ideas and the kind of method to help you find the best car at an affordable price tag too.

But, for now, let us discuss these 3 points, which are more important than finding a car, at least in the phase when you are looking for a car.

1 - The  type of vehicle and its real economic value

There are things that we need to know about the car. Only then can we know about the financing option fit for the car we have in mind.

You need to research the car's traits and functional features that will come in handy to understand its functionality and comprehend the expenses needed for it.

You must also check the pricing of the car from different sources. It is important that you come up with a fixed price tag as that will help your finance professionals (such as lenders) be more helpful with the service they give you.

Are you getting the car from the forum? Or are you purchasing it from a regular dealer? Is it an old or an unused car? Or what are the add-ons you need to take or manage?

These things are pretty important for understanding your vehicle in a better sense and coming up with a finalised quote.

For a thing like buying a car, this quote makes more sense.

2 - Car Finance Schemes in the UK

You can get a number of car finance schemes in the UK, and they are according to the state norms and regulations.

Therefore we have to learn about them in brief.

Here they are:

Let's go with PCP

PCP refers to Personal Contact Purchase. A more welcoming and affordable money scheme in the car finance world, PCP is often categorised as the leader in affordable car financing.

You are going to make a deposit of about 10% value of the car's price. This gives you permission to use the car but not to own the car.

Now you can make the payments in instalments for a number of months until the full payment has been made.

After that is done, you will be handed over the ownership of the car.

This scheme goes well for the new cars.

You can get these offers from car supermarkets or car dealers.

Finance brokers can arrange for this option as well.

Hire Purchase

Now this one is only a more organised version of the PCP car financing option.

HP or Hire Purchase works almost in the same way as the PCP but with some additional features, which you can use as your perks too.

You are to make a payment that is 10% of the value of the car. Consider this as the down payment.

With that, you are now guided to make instalments. But this time, you are going to make those instalments at a fixed interest rate.

Plus, the car finance term is also going to be a fixed term, which means our instalment amounts are non-variable, and you cannot change the finance terms (the duration and the frequency of payments) too.

With the last payment, you are allowed to make a transfer fee that entitles the ownership of the car from the dealer to you.

The term in this scheme usually gets over within 1 to 5 years.


Like PCP, you can talk to car dealers or get a deal in the car supermarkets.

Personal Contract Hire/ Car Leasing

So, PCH is not the middle ground between the two schemes already mentioned above.

It is an option for plainly renting the car for a particular period of time.

You can make that down payment in advance and can also go with the instalments likewise. But, the chances of the instalments here can be a little bit lower than PCP or HP as those two ways are meant to offer you the ownership of the car.

HP is basically for renting the car for the entire finance term. If you somehow get the car damaged, then you have to pay for it as repair costs are charged to you.

3 - Car Loans in the UK

Now you might need an instant car finance approval because many are in search of it due to making payments for the above-mentioned finance plans.

A personal loan for car finance or a car finance is one of the most flexible and most effective ways to ensure a car finance scheme is paid in instalments without compromising your financial management or personal finance.

In that regard, you can definitely try out a different car loan or automotive loan options too to find the right car you want and that too at the right time.

You know there are attractive offers!!!

Anyway, time to learn about personal loans for purchasing your car.

Here are some advantages of using a car loan to purchase a car:

Firstly, loans are offered in a bulk amount. You don't get loans in instalments. What you can o here is you can consider the offer your car dealer or car supermarket puts in front of you and make the full payment in cash to bring the car home. For the instalments, you can talk to your direct lender, and there you might get even more flexible plans than the ones your car dealers can give you.

The next advantage of a car loan is that car loan comes with unsecured properties. Gone are the days when you need to book a loan with some asset of yours, such as your home (for the mortgage). This is called collateral, and you can now get a loan without it.

Remember the fact we just told you about flexible payment? Well, you can also get more flexibility in not just loan terms but also in using the money as a car loan. If you book a car loan from us, then you can use the money for whatever cause you, please. You can use a part of it to buy the car and use the rest to pay for the add-ons.

To Conclude

Being a personal car finance company in the UK and also a direct lender, we have been made prominent by our sheer will not just to lend but help our clients with quality guidance and counselling.

If you are looking for that, you are going to get that too…we promise!

Just write to us or phone us anytime. We will be happy to connect.