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Can I get a used car on finance?

Yes – there’s a wide range of finance options available to help spread the cost of a used car over a series of monthly payments. The most common options include Hire Purchase (HP) and Personal Contract Purchase (PCP) agreements.

Many dealers will be happy to offer these packages on both new cars and used cars. Both finance types will require you to pay an initial deposit followed by a series of monthly payments.

As with all finance agreements, you’ll have to carefully consider whether you can afford the monthly payments before you sign a contract. Cash purchases will always be an option and could suit your individual circumstances better than a finance offer. For more information, read our complete car finance guide.

What is used car Hire Purchase finance (HP)?

If you buy a used car using Hire Purchase finance you’ll pay an initial deposit and a set number of monthly payments over an agreed period. Once your finance term ends, you will own the car to keep or sell on.

The amount you pay each month will depend on the car’s price, the size of the deposit and the length of your finance term. If you pay a large deposit, your monthly payments will be reduced and vice versa. The car will be legally yours as soon as you’ve paid the final payment – as a result, you won’t be able to sell the car before your agreement ends without the dealer’s permission.

What is used car Personal Contract Purchase (PCP) finance?

Used car PCP finance requires you to pay an initial deposit and a set number of monthly payments – similar to HP finance – but you’ll have to return the car to the dealer once your finance term ends. If you’d rather keep the car, you can buy it outright for an optional final fee.

The deposit and monthly payment amount will depend on the car’s price and the amount the dealer expects to be able to sell the car for once it’s returned. PCP finance agreements include mileage caps, too – if you exceed this limit, or return the car in poor condition, you may have to pay expensive penalty charges.

Can I lease a used car?

Leasing is more commonly associated with new cars but some dealers will offer to lease you a used car. Find a deal you like and the terms should be similar to leasing a brand new model – you’ll sign a contract that’ll state how much you pay each month and for how long.

The amount you pay monthly will be determined by, in part, how steeply the dealer expects the car to depreciate over your finance term. Used car residual values are often more difficult to predict than new cars and, as a result, dealers may offer more expensive leasing deals on used cars to cover the cost of unexpectedly severe depreciation.

As with PCP deals, your mileage will be capped and you’ll have to return the car in saleable condition at the end of your agreement.

Can I finance a used car with a bank loan?

Bank loans can be used to finance used cars in the same way as a brand new model. The interest rate and the amount you’ll have to repay each month will be set by the bank. These loans may be the most suitable option if your preferred dealer doesn’t offer HP or PCP finance packages on their used cars.

This type of personal finance could suit you better if you don’t have enough set aside for a large deposit. Unlike the other finance types mentioned here, you’ll be free to sell the car on at any point, too – providing you keep repaying the loan.

Used car finance available through carwow

All carwow dealers are manufacturer backed and can offer finance deals on both new and approved used cars. Use our car deals page to view these offers or sign up with carwow to browse the latest used cars in stock.

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