To get the best car loan, consider:

  • How much you need to borrow: Find a loan for the amount you need to purchase your car. Some companies offer loans up to 100,000.

  • How long you need to pay the loan back: Look for a loan that offers a suitable term. Most car loans can be repaid over 1 to 5 years.

  • The representative APR: This is the interest rate you will be charged for your loan. Look for the lowest APR so it costs you less to pay it back.

Some loans are secured against the vehicle you buy, so your car could be at risk if you do not keep up your repayments. Check if the loan is secured before you apply.

Think about whether you want a secured or unsecured car loan before you apply. Here is how both types of loan work.

This comparison includes car loans, and shows what loan amount, term and representative APR each lender offers.

How to apply for a car loan

When you have found a loan that suits your circumstances you can apply online through the lender's website, over the phone or by post.

After you have applied you will get a decision from the lender confirming whether they can offer you a loan, and at what interest rate.

To complete an application form you need to confirm:

  • How much you want to borrow and for how long

  • Your personal details including your name, address and date of birth

  • Your employment details

The lender will run a credit check to see how risky it would be to lend to you. Here is more on how your credit record affects the loan you get.

Other types of car finance

There are other ways to pay for your car, including:

  • Hire purchase

  • Personal contract purchase (PCP)

  • Personal contract hire (PCH)

You could also use a normal personal unsecured loan to buy your vehicle.

Car loans FAQs

Q

Can I use a car loan to buy any car?

A

It depends so check before you apply, but most lenders will let you buy a new or used car from an approved dealership.

Q

Will I have to pass a credit check?

A

Yes, when you apply the lender will check your credit record. Do not apply for more than one loan at once because this could harm your credit record.

Q

Can I use a personal loan to buy a car?

A

Yes, you can use a personal loan however you like if you have been accepted.

Q

What does APR mean?

A

It stands for Annual Percentage Rate, and is the interest you pay on the total value of your loan. The lower the APR, the less your will need to repay.

Q

What is a logbook loan?

A

A logbook loan is borrowing secured against your existing car, and is not used to buy a new vehicle.

Q

Do I need gap insurance?

A

Gap insurance can protect your finances if you write off your car before the end of your finance agreement but can be expensive; find out more here.

About our loans comparison

Q

Who do we include in this comparison?

A

We include loans and finance deals available directly from lenders and through brokers on our panel. They are all from lenders regulated by the Financial Conduct Authority. Here is more information about how our website works.

Q

How do we make money from our comparison?

A

We have commercial agreements with some of the companies in this comparison and get paid commission if we help you take out one of their products or services. Find out more here.

You do not pay any extra and the deal you get is not affected.