We make getting car finance simple so you can be on the road in no time with over 17 lenders and 70 products compared.

  • Get a free no-obligation quote - no impact to your credit file
  • Purchase any vehicle from any dealer or privately
  • Don’t pay broker fees - transparent process
  • Found a car? Check the history & value for free
Price calculator

Car finance calculator

I would like to borrow
To pay back over
3.5 years

Zuto is a credit broker, not a lender. Our rates start from 8.9% APR. The rate you are offered will depend on your individual circumstances. Representative Example: Borrowing £9,000 over 60 months with a representative APR of 20.9% the amount payable would be £234 a month, with a total cost of credit of £5,047 and a total amount payable of £14,047.

Zuto Limited. Registered in England under number 05722976. Registered office: Winterton House, Winterton Way, Macclesfield, Cheshire SK11 0LP. Zuto Limited is acting as a broker and not as a lender. Authorised and regulated by the Financial Conduct Authority, registration number 452589. Zuto can introduce you to a limited number of finance providers, based on your credit rating, Zuto won't charge you anything for this service, but do get a fee from the lender which varies based on the product or amount borrowed.

What do car finance companies look for?

You’re probably already aware than applying for any kind of loan or credit means a lender will check your credit rating. However, since car finance is often a ‘secured’ loan, companies that provide vehicle loans will generally need a little more information from you.

We’re regularly asked what finance companies look for when someone’s buying a car, so here, we’ll explore the subject in a little more detail, and explain what you can expect when you make a car loan application.

The underwriting process

You can’t explore the world of finance very far without coming across the term ‘risk’. 

When a bank or loan provider considers a car finance application, they’re essentially considering the risk that they won’t get the money back. If you represent a low risk, your application will sail through, and you’ll be offered an attractive rate. If you represent a higher risk, you’re likely to be charged a higher interest rate – and you may need to provide a larger deposit.

This decision-making process is where underwriters come in. An underwriter is a person responsible for considering the level of risk – before deciding whether finance can be offered – and at what rate.

What information does an underwriter need?

The first thing an underwriter will generally look at is your credit rating. If you have a history of making repayments on credit agreements on time, you’ve probably got a good credit score. On the other hand, if you’ve previously missed payments, or companies have had to use debt collectors to recover what you owe, your credit rating might not be so good.

There are other things which can negatively impact your credit score. For example, if you haven’t had much credit before – or you’ve recently moved to the UK or returned from time living abroad. 

Your credit score gives an underwriter the first indication of how much of a risk you represent. If you’ve paid debts back on time before, they’ll assume that the chances are you’ll do it again. Unfortunately, this same rule applies if you’ve had trouble with your finances – so if you’ve missed payments or been late with them, an underwriter will probably take this as an indication that you could do the same again.

So, it’s all about your credit score?

Certainly, a big part of what car finance companies are looking for revolves around your credit score – but there is more to it than that. 

We’ve already mentioned that a vehicle loan is going to be attached to your car – and that’s good news because it lowers the risk.


Well, if you take a personal loan, the finance company won’t have any other means of collecting the debt other than hoping you’ll pay it back (and pursuing legal action if you don’t). 

If you continue to refuse to pay for a personal loan, you may find that you’re taken to court and issued with a County Court Judgement (CCJ) demanding you pay – but, even then, there’s a chance that you won’t be expected to repay if you begin insolvency proceedings – like applying for an IVA or bankruptcy.

If you think that it sounds like the potential for a lot of hard work for the finance company, you’re completely right. With an unsecured loan, there is a small chance that the finance company could find themselves out of pocket.

Security and risk

So, what about a loan that’s secured against your car – like an HP or PCP deal?

When finance is secured against your car, things are much easier for the finance company if you can’t or won’t pay. In short, they’ll recover your car, sell it, and recoup their money that way. Hence – the risk is much lower. 

The thing is, this means that the finance company is going to want to know some details about the car you’re buying – since they might need to recover it and sell it in the worst-case-scenario. Generally, they’ll be able to gather all the information they need about the car from the registration mark – or, if you’re buying a new car, the make and model details.

Personal details

We know that a finance company is going to take a look at your credit rating and the details of the vehicle you’re going to buy – so is that it?

Not quite – there’s a little more needed.

While this information helps them understand the likelihood of something going wrong – and what they can do about it if it does, it doesn’t let them know anything about your current personal circumstances.
As such, you’ll need to provide some information when you apply for finance, including:

  • Your current employment/income details
  • Your address/living arrangements
  • An idea of your incomings/outgoings

With this information, the finance company will be able to calculate how much they can reasonably expect you to repay. For instance, a £200 monthly payment for someone who earns £2,000 a month is much less likely to cause a problem than a £700 payment for someone who earns £800. 

Of course, your application will also show the loan amount – another crucial piece of information that the finance company will consider. Again, borrowing £5,000 to help you buy a £20,000 vehicle represents less of a risk compared to say borrowing £19,000 to buy the same car. 

Other related FAQs

Looking for more related content to this? We’ve picked a selection of related topics that you may find helpful

You can approach lenders directly to get a car loan for a used car. However, it’s often best to use an online broker instead. This approach can save you time and help you to find the most competitive deals.

Settling a car finance agreement is usually just a case of paying back the amount you borrowed, plus any additional fees. If you want to settle early, you may face extra charges.

Dealerships and banks have access to some slightly different finance products. Banks can offer personal loans – and dealers can sometimes offer special promotions like 0% APR. Since you’re free to choose – you should compare all options available to you.

One of the easiest ways to check if you can get car finance is to use online affordability calculators.

When determining interest rates on car loans, lenders take a range of factors into account, including the size of the loan and your credit rating.

If you want to sell a used car with a loan, check the details of your agreement carefully. Unless you’re the legal owner of the car, you won’t be able to sell it until you’ve paid a settlement figure.

In many cases, yes, changing or part-exchanging a car with outstanding finance is possible. Since car finance can’t be moved from one car to another, you (or a dealership you’re getting your next car from) will have to settle the current loan and begin another on your next vehicle.

Car finance is calculated according to a number of factors, including the type of agreement you take out, your credit rating, the term of the loan and the size of deposit you pay.

Whether or not you can return a financed car depends on the type of agreement you have. If you’ve got a hire purchase (HP) or personal contract purchase (PCP) plan, you’re allowed to hand it back – as long as you have paid off at least 50% of the loan, including any fees and interest.

Applying for a car loan in someone else’s name is referred to as ‘accommodation finance’. This is likely to be against the finance company’s terms and conditions – and, in some cases, it could be considered to be fraud.