Credit Scores and Motor Finance: How They Impact Your Loan Approval
When it comes to securing motor finance, your credit score plays a pivotal role. Understanding how credit scores influence loan…
The above rates and monthly payments are an example only. The actual rate you will be offered by lenders could be lower or higher depending on your circumstances
Representative example: borrowing £6,500 over 5 years with a representative APR of 19.9%, an annual interest rate of 19.9% (Fixed) and a deposit of £0.00, the amount payable would be £166.07 per month, with a total cost of credit of £3,464.37 and a total amount payable of £9,964.37.
*Our lenders operate using an initial "soft search" which does not impact your credit score however, if you wish to proceed with the finance offered, the lender may carry out a "hard search" prior to sending you the finance documentation to sign.
You can choose from either Hire Purchase (HP) Finance or Personal Contract Purchase (PCP). The best type of finance depends on your personal circumstances.
In some circumstances, it can be. Provided payments are kept up with, getting finance could improve your credit score. What's more, you can start driving a new car much quicker than if you waited to save up the money.
Yes, it's possible. At Happy Motor Finance, we specialise in securing finance for people who have previously been refused in the past. Please speak to one of our team to find out more or apply and take a vehicle finance check form.
HP finance, or Hire Purchase finance, is a type of finance agreement that allows you to spread the cost of purchasing a vehicle over a period of time. It involves paying a deposit upfront, followed by monthly payments over a fixed term, typically between 1 and 5 years.
During the term of the agreement, the lender technically owns the vehicle, but you can use it as if it were your own. Once you have made all the payments, including any interest charged, you become the legal owner.
With HP finance, for instance, the interest rate is fixed at the start of the agreement, which means your monthly payments will stay the same throughout the term of the agreement. This makes budgeting easier and more predictable.
It's important to note that if you fail to keep up with the payments, the lender has the right to repossess the vehicle. So, before taking out an HP car finance agreement, or any other type of vehicle finance, it's important to ensure you can afford the monthly payments.
If you feel ready to apply for HP finance, use our vehicle finance application to establish your eligibility.
PCP finance, or Personal Contract Purchase vehicle finance, is another type of finance agreement that allows you to spread the cost of purchasing a vehicle over a period of time. It is similar to Hire Purchase (HP) finance, but with some important differences.
With PCP finance, you typically pay a deposit upfront, followed by monthly payments over a fixed term, which is usually between 2 and 4 years.
Let's say you bought a car on PCP finance, at the end of the term, you have three options:
You can return the car to the lender and walk away, with nothing more to pay (assuming you have met the agreed mileage limit and the car is in good condition).
You can choose to make a "balloon payment" to purchase the car outright. This is a large final payment that covers the remaining balance on the car.
You can use the car as a trade-in for a new car, and start a new PCP car finance agreement.
One of the advantages of PCP finance is that your monthly payments are typically lower than with HP finance, as you are only paying off a portion of the car's value over the term of the agreement. Additionally, at the end of the agreement, you have the flexibility to choose whether to keep the vehicle or return it.
However, it's important to note that if you choose to return the vehicle, you will not own it and will need to find another vehicle to use. Additionally, if you exceed the agreed mileage limit or the vehicle is in poor condition, you may be charged additional fees.
Carol St ClairAbsolutely brilliant company. Everything explained and sorted for me from start to finish. Will definitely recommend these guys. Thank you from a very happy customer 😁
idrees aliKirsty provided a fantastic service, would recommed to everyone. Happy motor finance
Matt JamesBrilliant help , very stress free experience. Highly recommend , Damien was excellent from start to finish .
Andy RyanAbsolutely outstanding service from Damian at Happy Motor Finance, start to finish 48 hours everything was explained and was an easy process. Highly recommended and cheers Damian much appreciated!
Victoria SumnerAmazing service from Leon and a new car sorted in less than a week.
Peter KilliardI could make this very very long winded but I won’t. I’ll just say that Kirsty and the team gave me the best customer service and buying experience ever. Thank you very much and I’ll be back when it’s time to upgrade.
Barry O'BrienKirsty was very patient, I don’t think I was an easy customer, I can’t remember how many cars I looked at, there was no pressure and Kirsty was extremely helpful and nothing was too much trouble, we eventually got a great deal on my ideal car, Thank you Kirsty
Jack ScoreyLeon was great! Fast responses to questions and always happy to help. Very quick process from start to finish. I would recommend this company to anyone.
Kyle DannIf I could give 6 stars I would, team member Yaz has been the most help from any finance company I’ve tried in getting a new car and helped me out massively. Top man and a top company would massively recommended.
