Car Finance Calculator UK

Important: This is an estimate, not a finance quote or financial advice. A lender may use a different calculation, include fees, set a different APR, or apply eligibility and credit checks. Check the pre-contract credit information and agreement before signing.

How to use the car finance calculator

1. Choose Hire Purchase or PCP.
2. Enter the cash price, deposit and any part-exchange value.
3. Add the advertised APR and agreement length in months.
4. For PCP, enter the optional final balloon payment or GMFV.
5. Add any fee that will be financed, then select Calculate car finance.

How the monthly payment is calculated

The amount financed is the car price plus any financed fee, minus your cash deposit and part-exchange value. The calculator converts the APR into a monthly rate and uses a standard reducing-balance repayment formula.

For PCP, the final balloon payment is discounted back over the agreement term before calculating the monthly instalment. That is why PCP monthly payments are usually lower than an equivalent HP agreement, but owning the car requires the optional final payment.

Hire Purchase versus PCP

Hire Purchase (HP)

With HP, you normally pay a deposit followed by fixed monthly instalments. There is no large balloon payment in this calculator, and ownership generally passes after the required payments and any small option-to-purchase fee specified by the agreement.

Personal Contract Purchase (PCP)

PCP normally combines a deposit, monthly instalments and an optional final balloon payment. The balloon is based on the finance provider’s estimate of the vehicle’s future value, often called the Guaranteed Minimum Future Value. At the end, your choices depend on the contract and can include returning the vehicle, using any equity towards another vehicle, or paying the final amount to own it.

APR and total cost

APR is intended to help compare the yearly cost of borrowing, including interest and certain fees. The rate actually offered can differ from an advertised representative APR. Compare the deposit, monthly payment, term, final payment, mileage conditions and total amount payable—not only the monthly figure.

Worked example

For a £25,000 car with a £2,500 deposit, no part-exchange, 7.9% APR and a 48-month HP term, the calculator finances £22,500 and estimates the monthly instalment using a reducing balance. Changing the term can reduce or increase the monthly payment, but a longer term will usually increase the total finance cost.

Consumer guidance: MoneyHelper on Hire Purchase, MoneyHelper on PCP and FCA guidance on APRs.

Used car finance calculator UK

You can use this car finance calculator for a used car as well as a new car. Enter the used vehicle’s agreed price, any cash deposit or part-exchange value, the proposed APR and the repayment term. Select HP for a standard hire purchase estimate, or PCP if the lender offers PCP on that vehicle and provides an optional final payment figure. Used-car finance rates, vehicle-age limits and eligibility vary by lender, so compare the actual quote and total amount payable.

Car finance monthly payment examples

For a £15,000 car with a £3,000 deposit, enter £12,000 as the amount effectively financed before any additional fees. Try a 36-month and a 48-month term at the same APR to compare the estimated monthly repayments and total interest. A longer term may lower the monthly payment but can increase the overall borrowing cost. For PCP, also enter the lender’s proposed balloon payment and check the mileage allowance and return conditions. These are illustrative inputs, not a finance offer.

Car finance APR calculator: what to compare

When using this UK car finance payment calculator, check the representative APR against the rate you are actually offered. APR is a yearly comparison measure that can include certain compulsory charges; it is not always the same as the interest rate used to calculate each monthly instalment. This tool provides an estimate from the APR you enter, so lender quotes may differ. Compare the deposit, fees, term, regular payments, any PCP final payment and total amount payable before deciding.

Hire purchase calculator UK: HP repayments explained

Looking at a hire purchase quote? Choose Hire Purchase (HP) above, enter the car price, deposit, APR and number of months, then select Calculate car finance. The result gives an estimated monthly HP repayment, total finance repayments and borrowing cost. A larger deposit generally means borrowing less, while a longer term can make each instalment more manageable but may increase the total interest paid. Check whether your agreement includes an option-to-purchase fee, as the lender’s final amount may differ from this estimate.

PCP car finance calculator and balloon payments

For a PCP estimate, switch the finance type to Personal Contract Purchase (PCP) and enter the optional final balloon payment quoted by the provider. PCP often has lower monthly payments than HP because a substantial amount is left until the end. That final payment is not free: you usually need to pay it to own the car. Before accepting a PCP offer, ask about annual mileage limits, excess-mileage charges, fair wear and tear, and what happens if you hand the car back or settle early.

Can I refinance a PCP balloon payment?

Some providers may offer a separate agreement to refinance the balloon payment, subject to eligibility and additional borrowing costs. This calculator estimates the original PCP agreement; it does not calculate a refinance offer. To estimate a new fixed-payment loan separately, use our UK loan repayment calculator and enter the proposed new loan terms.

How much car finance can I afford?

Start with a monthly amount that leaves room for insurance, vehicle tax, fuel or charging, servicing, tyres and repairs. Try changing the deposit, term and APR above to see how your estimated car payment changes. Do not rely on the lowest monthly figure alone: compare the total repayable and any PCP balloon payment. The amount a lender will actually offer depends on its affordability checks and your circumstances; this tool does not assess eligibility or give a finance quote.

Car finance settlement, negative equity and early repayment

If you already have finance and want to sell, part-exchange or pay off the car early, ask your lender for an up-to-date settlement figure. This is not necessarily the same as the remaining monthly payments. Negative equity can arise when the amount needed to settle the agreement exceeds the car’s current value. This calculator estimates payments on a proposed HP or PCP agreement; it does not calculate an existing agreement’s settlement amount, negative equity or early repayment charges.

New car, used car or personal loan?

The calculator works with a price you enter for a new or used car, but the finance options available can differ by vehicle and lender. HP and PCP are usually linked to the vehicle; a personal loan is a separate borrowing arrangement and may allow you to own the car from the outset. Compare the quoted APR, deposit, total cost and ownership conditions. If you are buying privately, check that your chosen finance provider permits that type of purchase.

Questions to ask before signing a car finance agreement

• Is the APR representative or the rate I will personally pay?
• What is the total amount payable, including fees and any optional final payment?
• Are there mileage or vehicle-condition charges if I return a PCP car?
• What happens if I settle early, change cars or miss a payment?
• When do I become the legal owner of the vehicle?

For independent UK guidance, read MoneyHelper’s PCP guide and HP guide.

Frequently asked questions