Everything You Should Know About Electric Car Finance

Electric vehicles (EV) are fast becoming the choice amongst car buyers in the UK. You might even have an EV in mind already or a shortlist of models you’d like to test drive. You're probably even thinking about electric car finance deals to make the purchase more affordable. If that's the case, but you're not sure how car finance for electric vehicles works, or just want more information about EVs, this guide's for you. Here's all you need to know about electric car finance, including a handy video explainer. 

Car Finance for Electric Cars

Hire Purchase 

Hire-purchase car finance is the most popular choice for many when it comes to electric car finance in the UK. With it, you can buy the electric vehicle you want without having to spend all your money in one go, which is great because a brand-new electric car will probably break the bank. 

The cost of the vehicle is spread over a certain period, usually between 12 and 60 months, which makes buying an EV more practical since you only have to think about the fixed monthly repayment. 

To make your monthly payment more affordable, try to pay a deposit if you can – it means you’ll borrow less from the lender. Another tip is to choose a shorter loan term. Your monthly payments will be higher but you’ll pay less interest overall, finish the loan quickly and then the car will be yours to own once you’ve completed all payments. 

Personal Contract Purchase

Let’s say you’re not yet sure about owning a car but you want to enjoy the benefits of having your own ride. In this scenario, you can choose a personal contract purchase deal. It has lower monthly payments compared to a hire-purchase deal and can offer the cheapest electric car finance in the UK if you find the right offer. But be aware that the payments you make do not cover the entire cost of the car - only the depreciation.

When you reach the end of your contract and you’ve decided that you do want to own the car, you'll need to make a final "balloon" payment. This is completely optional because you also have the choice of returning the car without any more financial commitments. Just make sure that the car doesn't exceed the mileage limits and is still in good condition. Otherwise, you could face additional charges. 

Why Get Electric Car Finance?

Let's be honest: EVs aren't the cheapest type of car on the market today, but don’t let that discourage you from going green. 🍃 With government incentives (do check what is still available at the time of reading as this is a changing situation) and tax exemptions (ditto), buying an electric car can be a savvy move, especially since conventional vehicles will be banned in the future. 

Not only will you be contributing to a greener planet, but there's also no need to pay for fuel. Instead, you'll pay for the cost of charging your car, which, in most cases is more economical than paying for petrol or diesel in a traditional fuel vehicle. 

If you buy an electric car on finance, it can also make the purchase easier on your bank account. You don’t have to put all or most of your savings into this single purchase. Whether you choose to get a hire purchase deal or a personal contract purchase agreement, be it a three-year contract or seven years, there’s something that will fit your financial situation. 

Top Reasons Car Buyers Want EVs

Cheaper to Run and Maintain

Regardless of where you plug in your EV to charge the battery, it's still much less expensive compared to topping up a petrol or diesel car. You can also save more money on upkeep by using an electric vehicle. Electric cars have an electric motor instead of a combustion engine. 

EVs don't need to be maintained on a regular basis like traditional cars. Such low maintenance requirements can save EV owners plenty of money throughout the life of the vehicle. Even if electric cars are a bit pricier than conventional vehicles, you get to eliminate typical car maintenance expenses and spend less money in the long run. Plus, you can buy new electric car on finance if you want to spread the cost so it's not too much in one go. 

Quick and Smooth Acceleration

If you’re looking for a car that accelerates quickly and smoothly, then you can get all that and more from an EV. Electric motors quickly respond and provide full torque almost instantly. They can provide a smooth and enjoyable ride because they have a lower centre of gravity than conventional cars. 

Not only are electric cars great to drive but they produce little noise. And since EVs are quiet, you might be somewhat confused at first whether the car’s ready to be driven. But don't worry, they're supposed to sound like that. Plus, you can always test drive an EV at a dealer near you to get a first-hand experience of how easy and fun they are to drive. 

Better for the Environment

Full-electric vehicles have no tailpipe emissions, making them the most eco-friendly choice among car buyers. The effects of climate change and pollution are being felt by many of us, especially those living in busy cities where air quality is poor. You can do your part in improving the environment by going green and switching to an environmentally friendly car. 🍃

When more car buyers choose electric vehicles over conventional combustion-engine cars, it means less air and noise pollution in many cities in the UK. With an electric car, you still get to enjoy the freedom and convenience of having your own vehicle but without harmful exhaust emissions being released into the atmosphere. 

Where Can I Find the Best Electric Car Finance Deals

If you're looking for electrifying car finance deals without getting zapped (sorry, we couldn't help ourselves), the best place to start is on the internet. You can use search comparison websites to match finance deals up against one another, although you're more likely to get generic responses rather than something tailored to your needs.

There's also the option of checking us out here at Carmoola. We do car finance like it's meant to be, which is to say we focus on top customer service, a fluid user experience and speed, all of which are powered by technology. So why not get your budget in just 60 seconds to see how much you might be able to borrow?  Find your perfect electric car finance deal today and let the sparks fly! Why not dig a little deeper and find out more about how Carmoola works 😀

Ready to Get Your EV?

There are plenty of electric car finance deals out there, and you can find the best ones by following the tips in this guide. Before you know it, you'll be behind the wheel of a sleek and stylish electric vehicle.  🔌🚘