How does car finance interest work?

You want to buy a car. So you apply to a finance company for a loan. Assuming you’re creditworthy, they then give you the money to make the purchase. Now the car’s owner, you have to repay the loan a little at a time – plus additional interest – each month. Usually over a number of years. The interest is a percentage of the value of the original loan. And it’s the price of getting the finance company to give you the money. Interest rates vary greatly. It helps to have someone working on your behalf to find you a great deal.

Here’s an example:

  • Amount you want to borrow: £4,500
  • Deposit: £0.00
  • Loan period: 60 months
  • Rate of interest: 14.9% APR
  • Monthly repayment: £104.63
  • Total amount you repay: £6,278.80

Now, what can we do for you?
CarMoney offers fiercely competitive rates for car loans. As well as great HP and PCP
deals. So that’s pretty much all the bases covered. Apply for finance and see for yourself here.

If it's vans you're after, check out our Van Finance Calculator 

Posted 13/03/2017 Back to Blog

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