Compare the full cost of car finance
Last reviewed:
A low monthly payment can leave a large final bill. Put competing quotations on the same timeline before comparing them.
Start with the outcome
Decide whether you intend to own the car at the end. For an ownership comparison, include the deposit, every instalment, any purchase fee and the final payment. A return-the-car scenario has a different outcome and may involve mileage or condition charges.
A worked comparison
Illustrative quotations for the same car: A costs £2,000 up front, 36 payments of £300 and £8,000 at the end: £20,800 in total. B costs £2,000 up front and 36 payments of £550, with no final payment: £21,800. A has £1,000 less cash outlay to own the car, before fees. Its monthly payment alone hides the £8,000 you still need. These are invented quotes, not available deals.
Put interest and fees in context
Use the car calculator to see how deposit, term and final payment affect an approximate repayment schedule. It uses the entered annual rate divided by 12 and excludes fees. A lender’s APR and payment schedule can use different conventions and include charges; the signed quotation is the figure to reconcile.
Check the household budget
Include insurance, servicing, fuel or charging, tax and repairs separately. If paying the final amount would require another loan, model that borrowing as a new scenario. A longer term can improve the monthly figure while increasing total interest.