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Car loans

Find our best deal on a new car loan

  • Driving down the cost of borrowing


MoneySuperMarket is a credit broker not a lender. You must be 18 or over and a UK resident.

Compare our best credit card deals from leading UK providers

MoneySuperMarket works with a range of household-name credit card providers, including

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Why choose car loans with MoneySuperMarket?

  • It’s quick and easy

    You can see all the loans you’re eligible for in one place. This includes the interest rate you’ll be charged and how much the monthly repayments will be, plus your chances of being accepted

  • It won’t harm your credit score

    We’ll ask a few quick questions about your finances to only show you deals that you’re likely to be accepted for 

  • Apply for your loan today

    Once you’ve found the right deal for you, click straight through to apply

We're 100% independent, working only for our customers

Unlike some of our competitors, MoneySuperMarket is not owned by an insurance company. So we can offer the best value, with savings delivered straight to you.

By combining independence with our excellent technology, we can negotiate the best prices and the best value on products and services.

of our customers would buy again
based on 2,600 reviews

How do personal car loans work?

If you don’t have the cash or savings to buy your new car outright, a personal loan can be a cheap and convenient way to borrow. Here’s how it works:

  • Decide how much you need

    Lenders will typically offer up to £15,000 on an unsecured personal loan. If you need to borrow more than this there are secured loans available where the debt is secured against your home

  • Consider how long you’ll need to pay it off

    The term for personal loans typically runs from one year up to five years, but while a longer term will mean lower monthly repayments, you’ll end up paying more interest overall so the loan will cost you more

  • Choose a suitable deal

    We’ll show you car loans you’re likely to be eligible for and your chances of getting the deal if you apply. You can change the length of the deal and choose based on the interest rate and cost of monthly repayments

  • Receive the money and start repayments

    The loan will be paid directly into your account so you can pay for your new car outright – whether it’s from a dealership or private seller. Your monthly repayments will usually begin straightaway

What are the pros and cons of car loans?

If you’re considering taking out a car loan, here are some downsides and benefits to weigh up:

  • Tick


    • Spreading the cost can make buying the car more manageable for you

    • If you keep up with payments, you could positively affect your credit rating

    • You can typically get newer and more expensive cars with a car loan

  • Cross


    • You end up paying more over time because loans come with interest. So, any money you borrow there will be interest added on top for you to pay back

    • You’re restricted with how you use the car. You need to keep track of mileage and any damages as you may be liable

    • If you miss payments, you risk damaging your credit rating

How much will a car loan cost me?

  • Loan amount. The more you need to borrow to buy your new car, the more you’ll have to pay back

  • Loan term. Longer loan terms generally mean your monthly repayments will be lower, but you’ll pay more interest in total 

  • Interest rate. The higher the interest rate (APR), the more you’ll pay overall. The interest rate offered will depend on your credit score

  • Fees & charges. Read the terms and conditions because there are likely to be charges for missed payments or paying off your loan early

car loan example

How to get our best car loan deals

  • Does the loan offer what you need?

    Only borrow what you need. The bigger the loan and higher the interest rate, the more you’ll pay back overall

  • Check the terms of the deal

    Ensure the deal delivers what you need – from the loan amount and interest rate to any fees, such as early repayment charges.

  • Compare from a range of deals

    Compare deals from leading providers and find a loan that’s right for you. Our eligibility checker shows your chance of being accepted

Can I get a car loan with bad credit?

It may still be possible to get a car loan, even if your credit score is low

But you’re likely to find...

  • Your choice of products is limited

  • Interest rates are higher

  • You won’t be able to borrow as much

  • You’ll need to use a specialist lender offering loans for bad credit

But taking steps to boost your credit score over time can open the door to greater choice and lower cost borrowing in future.

Representative 29.9% APR

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Know where you stand with a pre-approved car loan

When you’re pre-approved for a car loan, you can relax knowing the deal you see is the deal you’ll get. 

  • Apply with confidence

    When you’re pre-approved, the loan amount, duration and interest rate are all confirmed 

  • Tailored to you

    When you know what you’ll be able to borrow and how much it will cost, you can choose a loan that’s right for you 

  • You’re in safe hands

    Knowing the facts upfront puts you in control. You’re less likely to be rejected when you apply, so your credit score is protected

Alternative ways to finance a car

There are a range of alternative finance options for buying a car – if you don’t use a car loan. These include the following:

  • Personal contract purchase

    Put down a non-refundable deposit

    Borrow towards some of the remaining value of the car

    Make a large final payment to keep the car or return it and take out a new PCP on a fresh car

  • Hire purchase

    One of the most common options for car purchase

    Pay a deposit (usually 10%) and monthly payments to a car finance company

    You only own the car after you’ve made the final payment, plus any ‘option to purchase’ fees

  • Leasing – personal contract hire

    Pay a small deposit then fixed monthly payments to lease the vehicle

    Servicing and maintenance is usually included providing you don’t exceed a pre-agreed mileage

    At the end of the lease, you hand the car back with no option to buy

Compare car loans with MoneySuperMarket

Comparing car loans couldn’t be easier with MoneySuperMarket. Our eligibility checker tool will show you the loans you are most likely to be approved for – so you can protect your credit score

  • Tell us about yourself

    We’ll ask you a handful of simple questions about you, and your finances and the car loan you need

  • We browse the market

    We’ll sift through car loans from across the market, and show you the deals that suit you best

  • Pick the loan you want

    You’ll be able to sort car loans by overall cost and interest rate, and the likelihood you’ll be accepted

You’ll usually have to be 18 or older to be eligible for a car loan. If you have a good credit score it will be easier to be accepted for a car loan. However, if you have bad credit you may be eligible for a car loan from a specialist bad credit lender.

Most of the main high street banks offer personal, unsecured loans which you can take out to buy a new or used car. If you apply to a bank for a loan it will conduct a credit search on you to work out whether or not you can afford it. In contrast, if you look for a loan through MoneySuperMarket we can search the market without doing a ‘hard’ credit search, so it won’t impact on your credit rating. Then you can see which loans from across the market including the major banks – and at what rates – you might be eligible for before you apply. This cuts down the risk you will be rejected for a loan.

The APR or interest rate you’ll be offered on your loan will depend on your personal financial situation and your credit score. The better your credit rating, usually the lower the loan rate you’ll be able to get. The best rates are usually also available on larger loans – so typically those wanting to borrow around £5,000 or more. As a general rule smaller sized loans tend to have higher interest rates.

Car finance is a catch-all term used to describe different ways you can pay for a car on credit – if you can’t afford to pay in full in cash. Car dealerships will typically offer ‘finance’ which may be in the form of a loan or personal contract plan, or even hire purchase. Ensure you fully understand the terms and cost of any car finance plan before you sign on the dotted line. Some payment plans are complex and may have strict conditions of use, such as a maximum annual mileage.

As an alternative to dealer or specialist car finance you can just take out a standalone personal loan to pay for your car. 

As with any personal loan application you will need to provide information about yourself when you apply. The loan company will need your name and address (and any other addresses you’ve held over the past few years), plus details about your job, your income and your household budget – incoming money and outgoings. When you make a full online application the loan provider will conduct a credit check and look at your credit history. This is to assess whether you can afford the loan.

It depends on the loan provider but it is usually fairly quick. Once you’ve been accepted for a loan the cash could arrive in your bank account within hours, but more usually within a couple of days.

You can use a secured or an unsecured loan to pay for a car. With a secured loan you must put up an asset – usually the vehicle you are buying – as collateral, so the loan provider would repossess it in the event you were unable to repay. This does not happen with a personal or unsecured loan.

You can take out an unsecured personal loan or a secured loan through MoneySuperMarket and use it to pay for your new car.

You can usually pay off your loan early, but you may have to pay an early repayment charge. Ask your lender to send you an early repayment settlement amount so you can see how much the charges will be.

It isn’t usually possible to increase the amount of your personal loan once it has been agreed and paid out to you. If you need to borrow more you will usually need to apply again for another loan – and the rates and terms and conditions may be different to your first loan.

Many households are struggling to make ends meet as the cost of living keeps rising. There's little spare cash around to build up an emergency fund, which means it can be tricky to pay for a new washing machine or boiler if your old one breaks down. Maybe you need a new car, or perhaps you're planning a holiday, a wedding or a home makeover?

Let’s face it, most people at some point in their lives need to borrow some money. So it’s important to understand the pros and cons of the different types of loan, as well as how to secure the best rates. If not, you could end up with a poor deal – and costly credit can send you into a downward debt spiral.

Loans can broadly be divided into two categories: secured and unsecured. With a secured loan, the lender will insist on some sort of security against the money you borrow, often a house or car. If you default on the payments, the bank or building society can then sell the asset to clear the debt.

You can usually borrow large amounts with a secured loan, and at a lower rate of interest. Plus, you can pay back the debt over a long time period, perhaps 10 or 15 years.

However, secured loans are more risky than unsecured loans because you could lose your collateral if you cannot clear the debt. You should therefore think very carefully - and consider other options - before taking out a secured loan.

You can typically borrow as little as £1,000 up to a maximum of £25,000 with an unsecured loan – also known as a personal loan.

The interest rate is usually fixed and you pay back the debt over a set term, normally one, three or five years. Personal loans can therefore help you to budget because you know at the outset the full cost of your borrowings and how long they will take to clear.

For example, if you are getting married and the wedding is set to cost £7,500, you could take out a loan for £7,500 at 3% over three years. Your monthly payments would be fixed at £217.98 and you would pay total interest of £347.11 over the 36-month term.

Representative example: If you borrow £7,500, you would make 36 monthly repayments of £217.98. The total amount repayable is £7,847.11. Representative 3.0% APR, 3.0% (fixed) p.a.

If you have run up other debts at high rates of interest, a personal loan can be a good way to manage your borrowings and bring down the cost. Let’s say you have built up a debt of £3,000 on a store card that charges interest of 29%. You could take out a loan for £3,000 at, say, 9%, to pay off the store card balance and reduce the monthly payment. If you also cut up the store card, you would not be tempted to go on a spreading spree and add to your debt burden!

Interest rates on personal loans vary across the market, but as a rough rule of thumb, the more you borrow, the lower the rate. For example, you might pay interest of 9% on a £3,000 loan, but only 3% on a loan of £7,000. It can therefore make sense to borrow a larger amount, say £7,000 instead of £6,500. Just make sure you don’t take on a debt that you cannot afford to repay.

The size of the loan will to some extent determine the term of the loan. It is, for example, difficult to pay off a £7,000 loan in just one year as the monthly payments would be relatively high. However, if you borrow only £1,000, a term of 12 months is more manageable.

You also have to consider the cost implications of the loan term as the longer the term, the lower the monthly payments – but the higher the total cost.

The interest rates on personal loans depend partly on the loan amount and term. But lenders also assess your creditworthiness, usually by looking at your credit file.

The lowest rates are reserved for the best customers – that is, borrowers with a spotless credit record. If you are judged likely to default on the loan because of a poor credit history, you will be charged a higher rate of interest or your application will be turned down.

In other words, there is no guarantee that you will qualify for the advertised rates. Lenders are allowed to boast of low representative rates if those rates are charged to 51% of successful applicants, which means almost half could be charged a higher rate.

You can pay off your debt before the end of the loan term if you come into some cash. But watch out for early repayment fees. Many lenders levy a penalty for early repayment, which could wipe out any potential interest savings. Some lenders also charge arrangement fees for personal loans, which you should factor into your cost calculations.

You should try to work out how much you can afford to borrow and pay back before applying for a loan. This way you can look for loans in your borrowing range, giving yourself the best chance of being accepted as well as ensuring you don’t take on a loan that you can’t afford – you could even try MoneySuperMarket’s loan calculator for guidance.

Likewise it’s better to avoid taking out a loan without thinking carefully whether you need it, and whether the cost of the loan is worth what you’re taking it out for. For example, it’s probably not a good idea to take a loan out for everyday purchases – a credit card might be more suitable.

Interest free periods can be useful when you’re borrowing, but you should always keep an eye on how long this will last. Once the interest free period ends you may be moved on to a high rate instead, so it can be a good idea to pay off as much of your debt as you can during this interest free period.

Variable rate deals mean the interest rate at which you make repayments can change whenever the lender decides to change it – though often lenders will use the Bank of England base rate as a guideline. While this means that your repayments could be less if the base rate falls, they could also go up if the rate rises, so it could be a good idea to ensure you’ll be able to cope with interest rate fluctuations before taking out a variable rate loan.

Loan sharks should always be avoided – they’re illegal, not regulated by any financial organisations, and they generally charge massively high interest rates. What’s more, if you aren’t able to repay them you may be pressured into borrowing even more money, which could lead to a spiral of debt.

Payday loans may be legitimate, but they can come with incredibly high interest rates sometimes reaching over 1000% - which could make even a small loan turn into a debt spiral. Learn more with our guide to payday loans.

Every loan application you make, just like credit applications, leave a mark on your credit report. Too many of these will give lenders the impression that you are desperate to take out a loan, which could imply that you’re struggling to manage your finances – as a result, lenders may be more reluctant to let you borrow from them in the future.

Rather than making lots of applications and hoping one will stick, you may be better off running a soft check on your credit score to see what kinds of loans you’ll be eligible for. This way you can minimise your applications and reduce the chance of you damaging your credit.

Often with loans, the more you borrow the less interest you’ll end up paying. It can vary by lenders, but you should always check on the interest rate they charge as there might be a chance you actually pay less overall by choosing a bigger loan with a lower interest rate.

The best way to find the right deal on a loan is to shop around, and by comparing deals on MoneySuperMarket you’ll be able to browse a list tailored specifically for you. All you need to do is answer a few questions about the loan you need and you’ll be able to compare loans from a number of different providers by the rate you’ll pay back at as well as how likely you are to be accepted.

You work hard to earn your money, and we don’t think you should waste a penny of it paying over the odds on your household bills. That’s why at MoneySuperMarket, we’re on a mission to save Britain money.

  • Whip your credit score into shape with Credit Monitor

  • Super save over and over again with Energy Monitor

  • There are always more ways to save with MoneySuperMarket 

So how do we make our money? In a nutshell, when you use us to buy something, we get a reward from the company you’re buying from.

You might be wondering if we work with all the companies in the market, or if our commercial relationships with our partners might make us feature one company above another. We’ve got nothing to hide, and we want to give you clear answers when it comes to questions like these, so we’ve pulled together everything you need to know on this page.