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Explaining Our Finance

Finance might seem like a minefield to you but it really is a simple process. Car Loans Express have tried to simplify this for you to assist with your understanding.

What is Our Finance?

Our finance is simply the different financial products which allows someone to acquire a car with any arrangement other than a single lump payment.

What are the types of  Finance we offer?

There are a number of options for Finance depending upon which option is right for you these options have been explained in further detail below:

Hire Purchase

Many dealers will offer you Hire Purchase to buy your car over a set period, with fixed monthly payments.

  • An initial deposit may be required
  • A bigger deposit reduces monthly repayments
  • You only own the car when the last payment has been made
  • You must settle the finance debt before selling the car

Unsecured Loans

This is a loan which is based on your ability to make monthly repayments. No assets, such as your house or car, are used as security for the loan.

  • The monthly repayments and loan length (term) are fixed
  • A car bought with an unsecured personal loan is owned outright by you and can be sold at any time, but the repayments will continue regardless of whether you still own the car
  • Most unsecured personal loans cannot be repaid early without incurring a penalty payment
  • If you choose a flexible loan it may allow you to take a break in repayments or to repay the loan early, free of charge
  • Choosing a deferred loan may permit lower monthly payments, but with one large payment at the end of the loan contract

Secured Loans

You can secure a loan against assets such as your home, which allows larger amounts to be borrowed over a longer period.

  • Lower monthly repayments than equivalent unsecured personal loans are usually available
  • If you cannot make repayments, the assets used to secure the loan can be repossessed

Personal Contract Purchase (PCP)

A PCP allows you to pay a deposit and lease a car for a fixed time with lower monthly repayments.

An example PCP plan for a £20,000 car could be:

  • A large deposit – £6,000
  • Monthly payments – 36x £250 (Totalling £9,000)
  • A final payment – £5,000

The final payment – sometimes known as a balloon payment – is calculated at the beginning of the agreement and is based on the predicted future value of your car. At the end of the agreement, there are three options:

  • Pay the balloon payment and keep the car
  • Hand the car back and walk away from the deal
  • Use the guaranteed value as a deposit for your next car


  • PCP payments are usually lower than Hire Purchase (HP) payments
  • You don’t fully own the car until the balloon payment is made
  • You can’t sell the car until the balloon payment is made
  • Going over the set mileage will incur extra costs
  • Some PCP contracts can include maintenance of the car

What are the Risks of Finance?

With all types of loan and credit agreements, there are some risks, but in the UK finance is regulated by the Financial Conduct Authority and lenders must follow responsible lending practices. The finance is secured on the vehicle, so if you don’t keep up with the monthly repayments the lender could repossess the vehicle.

As with any type of finance, missing payments can damage your credit profile, but a responsible lender will look at your income and expenditure and make sure you can afford the repayments.

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    • "This is the second time I have used Carloans Express, wouldn't use any other. Get the best deals and best finance packages that main car dealers. Nick and his team are very patient and understanding and are always a phone call / text away. Excellent handling as usual from start to finish. A* service. Have recommended Nick and his team to friends to use and their experience has been exactly the same. Good company, good man... AMAZING car. Thanks guys, see you in 12 months - Billy"

    • "I have used Car Loans Express for my finance for the past 5 years. The service is very personal and I would recommend them to anyone looking for a no-jargon, friendly service."

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    Car Loans Express Ltd, Floor 2, Office 21, Boho 6 , Linthorpe Road, Middlesbrough, TS1 1RE  | ©Car Loans Express Ltd 2014 Car Loans Express Ltd is a company registered in England and Wales. Company registration number: 5985650. Registered Company address: Car Loans Express Ltd, Floor 2, Office 21, Boho 6 , Linthorpe Road, Middlesbrough, TS1 1RE. Telephone: 08450 264686. We act as a credit broker not a lender. All finance is subject to status and income. Written Quotation on request. Car Loans Express Ltd can introduce you to a limited number of finance providers based on your credit rating and we may receive a commission for such introductions. Car Loans Express Ltd is authorised and regulated by the Financial Conduct Authority for consumer credit FCA No. 659136.