FAQ

Yes, you can use PCP to finance an electric car. Personal Contract Purchase (PCP) spreads payments over 2 to 4 years, with fixed monthly costs based on the vehicle's depreciation rather than its full value. This keeps monthly payments lower than traditional lending, making it a popular choice for drivers who want a newer car without the higher costs. At the end of the term, you can pay the balloon payment to own the car, hand it back, or part-exchange it. Just watch out for excess mileage or dam...

A preferred option for many drivers, financing provides you with the funds to purchase a new or used car. Rather than paying for a car outright, financing the vehicle means you repay the loan in manageable monthly instalments over an agreed period. Car finance can prove to be very flexible, so you get to choose how long the term is, whether you want to put down an initial deposit (and how much), as well as secure fixed payment terms.    

For many businesses and sole traders, van finance is a preferred option rather than buying a vehicle outright. New vans, especially, can be an expensive purchase, yet a used van may not reflect the quality of your business or brand. For this reason, financing a van is a great choice; not only will you get to drive the latest model without it costing the earth, but you’ll also get to spec it out to meet your needs.

Whether you have your eyes on a brand-new set of wheels, a second-hand motorbike, or a classic model, motorcycle finance is an option well worth exploring. Applying for funds from a specialist lender can enable you to purchase a more expensive make and model than you previously thought you could afford when finding the cash upfront. Depending on the type of deal you opt for, it may be possible to part-exchange and upgrade your bike at a later date.

A good APR rate for car finance in the UK is generally considered to be between 9% and 12%. Compared with historical benchmarks, average interest rates offered across the market have increased by nearly 2% in recent years, largely due to broader economic conditions, including high inflation and rising base rates driven by the cost-of-living crisis. Lenders have also tightened approval criteria, making financing at above 10% APR more common among average borrowers than in previous years. However...

You can calculate car finance with this formula after you’ve determined the car cost minus any deposit you’ll put down.  Monthly payment = amount borrowed x flat rate of interest x number of loan years ÷ number of loan months Using our free online car finance calculator below can help automatically work out the figures after you input the variables.

An annual percentage rate (APR) is agreed upon when taking out car finance - this includes the headline interest plus any additional fees. Common rates are around 12% APR. It’s worth remembering that, rather than paying just the original amount borrowed, the monthly interest rate is charged on the outstanding balance each month, which is the total amount payable.

There are three main types of car finance: Personal Contract Payment (PCP) Hire Purchase (HP)  Lease Purchase (LP)

The minimum credit score needed for car finance approval in the UK can vary by lender, but the general guidelines are as follows: Excellent - Scores over 720 can expect the highest chances of approval on the best interest rates. Good - Scores from 670 to 719 often qualify for average to good car loan rates. Fair/Average - Scores between 580 and 669 may qualify for subprime financing rates, but can still get approved. Poor/Bad - Scores under 580 typically mean deals are usually available on...

The time to get approved for car finance varies depending on your lender and the application method you use. It’s possible to receive instant or same-day decisions from lenders.  For decisions that require additional verification of documents or income sources, a wait of 1-3 days on average is likely for the final credit decision. Sometimes applications require additional steps, such as adding a guarantor or sending a reference to an underwriter for assessment, which can take 3 to 7 days.  In ...

Yes. We’ll check your credit report to review your borrowing history and previous repayments. Having good credit increases your chances of getting approved for car finance. However, we do work with subprime lenders who specialise in providing finance deals for customers with bad credit. 

Getting car finance is generally not too difficult for most people as long as they meet the basic eligibility criteria. Industry-wide approval rates can be 70% or higher, as lenders tend to accept most applicants to avoid losing business.  Lenders offer a range of options tailored to different borrower profiles, so you should be able to get a car finance deal that suits your circumstances. However, approval is never guaranteed, as poor credit, unstable income, or a bad borrowing history might ...

Most of our lenders require borrowers to be UK residents and at least 18 years old. Some lenders have a minimum age requirement of 21. Our lenders want to see a steady income sufficient to make monthly repayments during the agreed loan term. Many require a minimal annual income.

Applying for car finance with bad credit will require you to share both personal and financial information. Here is a list of some of the details you could be expected to submit: Your full name, date of birth, and marital status A copy of your driving licence  Your current address and proof of residence via utility bills Employer’s name and address, as well as job title and salary (previous employment details may also be required) Payslips or bank statements for proof of income (likely to...

Car finance for borrowers with bad credit is available, but it isn’t always advertised. This is why it’s helpful to reach out to brokers like us who already have relationships with lenders that can support those with poor credit histories.

The application process for car finance with bad credit is much the same as if you have a good credit score, except the lender will already know you have a poor credit history. This doesn’t mean you won’t be accepted for finance, but that it may be more difficult to obtain, the interest rates offered to you are higher, or you may be advised that a guarantor is needed instead. 

Before you apply for car finance with a poor credit history, it’s important to weigh up the pros and cons of doing so: What are the pros of bad credit car finance? What are the cons of bad credit car finance? Enables you to purchase a vehicle It is harder to get approved You can ask someone to be a guarantor You may need to pay more up front Work with a broker who can put you in touch with specialist lenders You may be restricted to borrowi...

Bad credit - or poor credit - car finance is aimed at borrowers who do not have a very good credit history and may otherwise struggle to gain finance for their new or used vehicle. Specialist lenders provide this type of finance to people, but it’s worth understanding exactly what is involved before you apply. 

Applying for any kind of car finance - specialist or not - will require you to provide certain details relating to your personal, work, and financial history - such as proof of income.

Poor credit is the biggest barrier for people applying for race car finance. Vehicles used for motorsport can be more costly and require borrowers to have a good credit history.

As long as you meet the necessary criteria, pass the relevant credit checks, and can make the monthly repayments, you will be eligible to apply for classic car finance.

Applicants with bad credit are unlikely to be approved for classic car finance because the options are limited. The high value of classic models means specialist lenders can and will be choosy about who to release funds.

At Octane Finance we work with specialist lenders who offer all types of race car financing; from touring cars to rally cars and open-wheel race cars too, nothing is beyond our capabilities. Access more information via our race car finance page.

Most standard lenders will only finance cars up to 12 years old, which is why a specialist lender is required when it comes to financing a classic or vintage model.

If you own a supercar and its value has increased since purchase, then you could be eligible for what’s called 'equity release'. This is a way of freeing up cash without the need to sell a treasured vehicle as you are simply borrowing against its value.

Leading car finance companies specialising in classic cars can provide funding for pretty much any model, so the choice is yours. Here at Octane Finance, we broker finance deals for classic car owners, so speak with us about your options.

Financing a supercar means you won't need to pay a large upfront cost and can instead spread the payments over a set period of time. This means your cash is available for other purchases or investments.

The short answer is yes. As long as you meet the requirements needed to apply for supercar finance, it is possible to fund a performance car this way - a solution we provide here at Octane Finance. However, you will likely need an excellent credit score to be approved for high-end funding.

Absolutely! At Octane Finance, we understand that many customers are interested in financing second-hand electric vehicles, and we're here to help. Our market-leading finance solutions are available for both new and used electric cars.

Yes, at Octane Finance, we offer a range of financing options for electric vehicles (EVs), including cars, vans, and motorbikes. Our experienced team works closely with our extensive panel of trusted lenders to provide you with competitive rates and tailored finance solutions for battery-powered vehicles.

Yes, it is possible to pay off the balloon payment early during a Lease Purchase agreement. Early repayment charges may be incurred, so it's best to speak to your lender first before committing to doing so.

Certain criteria must be met in order to be accepted for Lease Purchase vehicle finance. Because LP deals are aimed at those wishing to invest in a premium brand of car, a good credit score of around 700 is desired by lenders. In addition, you will also need to prove your monthly and annual income to confirm you are able to meet the monthly repayments.

Your monthly payments contribute to paying off the total value of the vehicle for the duration of the contract, which is then settled with a final lump sum known as a balloon payment.

Yes, your vehicle is at risk of being repossessed by the finance company if you don't keep up with the agreed monthly repayments. Hire Purchase finance works on a 1 to 3 rule with the lender; if you fail to keep up with payments, the finance company can take the car away at any time - even without a court order - unless you’ve paid for at least one-third of the vehicle already. In this case, a court order will be needed for the lender to take the car away.

While you're paying back the monthly payments during a Lease Purchase agreement, it is the finance company that is the legal owner of the vehicle. Once all payments are made - including the final balloon payment - ownership is then transferred to you as the borrower. To find out more, read the Octane Finance Lease Purchase guide.

No, you cannot sell the car to pay off the remaining HP finance owed. This is because you don't legally own the vehicle, which remains the property of the lender until a final payment is made.