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How Do I Compare Car Finance Companies?

With so many options when it comes to choosing a car financing company in the UK, a lot of car buyers are often confused with their choices. Before you pick one, it would be best if you can do a car finance comparison so that you can determine which deals are best suited for your situation. 

Important Points to Remember

When looking for a financing company, there are some things that you have to keep in mind. For example, don't forget that it’s your money so you should be the one to decide. Don't let anyone force you into taking a deal that you do not like.

Do Your Research

It is also crucial that you know the pros and cons of choosing a particular car finance company. Take all the time that you need to do thorough research on various car finance deals being offered to you. Look closely into the details of the agreement such as the total cost of getting car finance, the interest rates, and the length of the contract term. If you don't feel confident or simply don't have the time, you might consider getting a broker who could point you in the direction of a company that could best cater for your particular circumstances. 

Take Your Time

Don’t feel pressured to choose the first car finance company that you talk to. Don't be in a hurry. When deciding, you have to weigh in on the advantages and disadvantages of each offer so that you can get the best car finance deal. 

Be Ready for the Checks

Another point that you should keep in mind is that you shouldn't panic about the processes necessary to get financing. For example, your credit will be checked. Your credit score might be knocked off a few points because of the hard check that needs to be conducted by the car finance company. But if you are a good payer, then you can earn those points back eventually. 

Have Realistic Expectations

It’s also important that you know your credit score and background. This way, you will be able to manage your expectations about the deal, or whether you will be offered a car finance deal at all. If you have a bad credit score, you might find it challenging to get a good deal. 

Some financing companies may approve your application for car finance but the interest rate might be too high. If this is the case, it may help you to build up your credit score first so that you can get a better deal. 

Have a good understanding of your financial situation and be realistic about your capacity to pay the monthly instalment before buying a car. The first question any car buyer should ask is “can I really afford this new car?” By answering this question honestly, you will be able to determine what car is within your budget. 

Scrutinise the Contract

You also need to understand the details of a car finance deal. This includes the total cost of getting car finance, the amount for the monthly repayments, and the interest rates. Study the numbers thoroughly before signing any agreement. And of course, take all the time necessary. There’s no pressure for you to decide immediately. 

Comparing Car Finance Companies

The best way to compare different financing companies is to look at their interest rate, the length of the contract term, and whether they offer flexible payments. While all car finance companies basically offer the same thing and are similar in many respects, they also differ in many ways. It is important that you look closely into the details of the deals being offered to you so that you can see which options will allow you to save the most money. 


Of course, it would be practical to choose a car finance deal with the lowest interest rate. You may also want to check how convenient their processes are. For example, do you need to go to the car finance company's office to submit your required documents, or is it possible to simply submit them online over a mobile application or through their website? Convenience is also a major factor when it comes to choosing the best car finance company.

Contract Term Length

And then there's the length of the contract term. Can you get car finance for two years? Are they also willing to give you a deal for seven years? While it depends on your financial situation and your preference, you would want a car finance company that can accommodate your needs.

If you want a seven-year contract because you want a more affordable monthly repayment, it would be ideal if the car finance company can present you with a good deal and a reasonable interest rate that suits your budget. 

Use Car Finance Calculators

Another thing that you can use when comparing car finance companies is a car finance calculator. You can adjust the different factors in the calculator, such as the contract term length and budget. You will then be able to see how much you need to prepare every month for the repayment.

Many car finance companies have car finance calculators on their websites. Be sure to make use of them and take note of the results. This way, you can easily see which ones offer good deals that will allow you to stick with your budget.

You have to remember though that the results of the car finance calculators are only to serve as estimates and are not the actual amount that you will be paying once you've signed the contract.


Buying a car is an exciting time for you. While there are many things to consider, remember to take your time. Making this purchase is among the biggest decision you’ll make. Do your research, study the numbers, and ask for advice. But don't get yourself too worried or too anxious that you forget to enjoy the moment when you finally drive home your car.

Keep in mind to take as much time as you need when choosing the best car finance companies in the UK. The more you get to know about the deals, the better it is for you and your finances.

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