Which Car Finance
is Best for Me?

Great news - you’ve found your ideal car!

Now for the easy part - buying it!

At Motor Range, we're here to make the car-buying process as easy as possible with a great range of car finance options, but which is the best one for you?

Finding the right way to fund your new car is as important as your choice of motor.

Here's our list of top tips, and pros and cons of each of the many ways to finance your car:

What Do I Need to Think About Before Deciding How to Pay for My Car?

Make a list.

Is the car for business or private use?
How many miles do you think you'll drive in a year?
Do you have a deposit?
How much can you afford to pay - in total or monthly?
How long do you want to keep the car?
Is it important to you that you own the vehicle outright?

All of these things can affect how you pay for your next car.

Picture of Icons showing Pound Signs

What Car Finance
Options Are Available?

There are 3 main ways that our customers use to fund their next car – cash, car finance or a personal loan.


If you've got the CASH, great!

Simply hand it over and you'll own your new car immediately.

However, with great rates on car finance, you may actually be better off if you invest your cash elsewhere (in an ISA, for example) and take advantage of low interest deals available through one of our finance options.

Personal Loan

With a PERSONAL LOAN, you'll own the car as soon as you hand over the cash, and you'll then have to pay back the lender with interest. This can work out at a higher monthly installment than HP or PCP. A loan can also take a while to set up and transfer funds.

Some personal loans require security, for example your home, and if you default on the loan repayments, the lender can stake a claim to your other assets.

With either of these cash options, when you fancy changing your car, you can arrange to sell it on or trade it in.

Car Finance

Using CAR FINANCE is not only for new cars. It's convenient, quick and easy, and often means smaller monthly payments than a personal loan. Car finance is arranged between you, Motor Range and one of our trusted providers. It offers protection under the Consumer Credit Act if you decide that you need to change your car before you make the final payment.

These are rights that you don't have through a cash purchase or purchase using a personal loan.

Hire Purchase

A HIRE PURCHASE contract is one of the most popular methods of car finance that our customers use at Motor Range. With HP, you'll pay a deposit and spread the entire balance of the car's cost over 2 to 5 years.

The car will be yours at the end of the contract with no need to worry about mileage limits!

The monthly cost is fixed at the beginning of the contract so you'll pay the same, every month throughout the contract. If you wish, you can make overpayments at any time during your agreement. This would shorten the period of the term, or reduce the monthly payments and could even mean you pay less interest!

If you decide the car isn't right for you, once you've paid half of the agreement, you can return the car (in a reasonable condition), without penalty.

Personal Contract Purchase

A PERSONAL CONTRACT PURCHASE is another great way to buy a car. If you choose PCP, you'll pay a fixed number of payments which will remain the same throughout the contract.

At the beginning of the contract, the finance provider will offer you a Guaranteed Future Value for your car based on your annual mileage so, at the end of the payment period, if your car is worth more than this estimate, you can use the extra as a deposit on your next car.

After the agreed term, you can pay a final sum to own the car outright, hand the car back or part exchange for another car if its value is greater than its Guaranteed Future Value. You can specify the length of the contract (from 2 to 5 years) and also the number of miles you are expecting to drive each year to reach a monthly fee that you are comfortable with.

Find Out More About PCP >

With both PCP and HP, you can ask for a settlement fee at any time, which will allow you to pay off the rest of the contract in one lump sum in order to own the car outright. On either of these car finance types, if you settle early, you could receive a rebate of the interest, costing you less in the long run.


Some dealerships offer LEASING, though this is more usual with brand new cars. For a fixed monthly fee, you have use of the car which is serviced and maintained by the leaser. The car never belongs to you and there is no option to purchase it at the end of the contract.

By using the right car finance option for you, you can ensure that you pay an affordable amount for the car that you really want.

How do Car Finance
Options Compare?

Comparison Table
Picture of Icons of People

Which is the Best Car Finance
Option for Me?

We've put together a few examples of customer profiles to let you see which finance packages could be appropriate for different scenarios.

Don't forget, at the end of the day, it's your choice. We won't pressure you into signing up for anything you don't want or need. We want you to enjoy your motor without any stress about how you'll pay for it.

Jack is 32 years old and single. He keeps up with the latest trends and likes to change his car every two or three years. He pays rent on his flat and has a half hour commute to work, Monday to Friday. He pays for his gym membership via monthly direct debit and also enjoys going to the pub every week to watch his football team play.

Ideal car: Audi A3

Chosen payment method: PCP

The lower monthly payments are perfect for someone who has lots of other bills to consider and who likes to change cars every few years. Lower rates mean access to a higher spec of car that might not be affordable through other means.

Picture of Jack and their ideal car an Audi A3

Alice is 21 years old and lives with her parents.

She has just passed her driving test. She has a job at a local solicitor's office which means that she can afford to go out to the cinema or for a meal with friends a couple of times a month. Her grandparents gifted her a sum of money for her 21st birthday which she has been saving as a deposit on a car.

Ideal car: Fiat 500

Chosen payment method:

With a decent deposit, steady income and few outgoings, this option is ideal for those who want to purchase the car outright for long-term ownership or to use as part exchange in the future.

Picture of Alice and her ideal car, a Fiat 500

Carl and Amy are in their 30s.

They have three school-aged children. The family enjoys days out and goes camping often. Amy's ten-year-old Renault Scenic has just failed its MOT and the repairs will cost more than the car is worth, however, she needs a new car to transport the kids. The family is also saving to install a new kitchen so they don't have much of a deposit for a new car.

Ideal car: Vauxhall Zafira

Chosen payment method: PCP

Ideal if you have little or no deposit and have other, long-term expenses, such as a mortgage or home improvement loan. At the end of the agreement, the couple can reassess their financial situation to see if they can afford to buy the car outright or take on another PCP agreement.

Picture of Carl and Amy and their ideal car, a Vauxhall Zafira

Jane is 29 years old and single.

She's still trying to find her perfect job and is currently in her fourth job in six years. She likes to shop so has racked up a bit of credit card debt and missed a few payments in the past, which she blames for being refused finance in the past. However, she's now been offered her dream job which requires a 20 minute commute so she really needs a car that's affordable and cheap to run.

Ideal car: Ford Fiesta

Chosen payment method: HP

Available with no deposit to keep costs to a minimum and allow other debts to be paid off. This option allows the car buyer to adjust the length of contract to find an affordable payment plan, after taking other monthly commitments into consideration.

Picture of Jane and her ideal car, a Ford Fiesta