UK Car Finance Calculator 2026

Free UK car finance calculator for 2026. Compare PCP, Hire Purchase (HP) and personal car loans. Estimate monthly payments, balloon payment, APR, deposit, term length, total repayable and affordability across England, Scotland, Wales and Northern Ireland.

Last revised 13 September 2026

By Team GlobalCalqulate · About our editorial standards

Vehicle Details

Vehicle price

Deposit

Trade-in value

How this estimate was calculated

Your agreement covers about 40,000 miles over 48 months. PCP contracts charge an excess mileage fee — commonly 5p to 15p a mile — for anything beyond the agreed limit, so a 5,000-mile overrun can cost £250 to £750 at handover.
The £10,000 optional final payment is not part of the monthly figure. You pay it only if you keep the car — otherwise you hand it back or trade it in.

Financial Disclaimer: This is an illustration of car finance costs, not a quotation or an offer of credit. Actual terms depend on the lender, your credit profile, agreed mileage and the condition of the vehicle at the end of the agreement. Check the total amount payable and the APR before signing. Full disclaimer.

Sources & methodology

Formula:: Amount financed
Reference:: Financial Conduct Authority Handbook

Calculation type: Exact calculation. Figures are taken from Financial Conduct Authority Handbook — see sources below.

Formula & methodology

Formula used

Amount financed

P = car price − deposit + fees

The deposit reduces what you borrow; arrangement and dealer fees added to the agreement increase it.

PCP monthly payment

M = (P − B ÷ (1 + i)^n) × i × (1 + i)^n ÷ [(1 + i)^n − 1]

On a PCP only the balance above the optional final payment is amortised, after that final payment is discounted back to today.

HP monthly payment

M = P × i × (1 + i)^n ÷ [(1 + i)^n − 1]

Hire purchase amortises the whole amount financed, so the balance reaches zero at the end of the term.

Total amount payable

Total = (M × n) + balloon (if kept) + deposit

The real comparison between deals: everything paid across the agreement, not the monthly figure.

Variable definitions

Symbol	Meaning	Unit
P	Amount financed. Car price less deposit, plus fees added to the agreement.	£
B	Balloon / GMFV. The optional final payment on a PCP, capped at the amount financed.	£
i	Monthly rate. APR divided by 12.	decimal
n	Term. Length of the agreement in months.	months

Step-by-step calculation

1. Establish the amount financed
Take the car price, subtract the deposit and add any fees.
2. Handle the balloon on a PCP
Discount the optional final payment to present value and amortise only the remainder.
3. Compute the monthly payment
Apply the annuity formula for the chosen structure and term.
4. Total everything payable
Add the payments, the deposit and — if you intend to keep the car — the balloon, to compare deals honestly.

Limitations

A lower PCP monthly payment does not mean cheaper finance: it defers a large final payment. Compare total amount payable instead.
Mileage limits and condition standards are central to PCP agreements and are not modelled — exceeding them adds per-mile and damage charges at the end.
Depreciation, insurance, road tax, servicing and fuel are excluded; this covers the finance only.
The Guaranteed Minimum Future Value is set by the lender from projected residual values, and is not something this calculator can predict for a specific car.
Representative APRs need only be offered to 51% of accepted applicants, so the rate you are quoted may be higher.
On both PCP and HP you do not own the car until the agreement is settled in full.

This page is educational. It applies a standard formula to the figures you enter and shows the arithmetic behind the result. It is an estimate, not an offer, a quotation or financial advice: real costs depend on the provider's pricing, fees and underwriting, and on circumstances this calculator does not collect.

Sources & references

RegulationCONC App 1.2 — Total charge for credit rules (APR calculation) — Financial Conduct Authority Handbook
Defines how APR and the total charge for credit must be calculated for UK consumer credit — the basis of the periodic rate and total-repayable figures this calculator produces.
RegulationCONC App 1.1 — Total charge for credit rules for agreements secured on land — Financial Conduct Authority Handbook
Companion rule set defining which charges form part of the total charge for credit, which is why the fees entered here change the total repayable and not only the monthly payment.

Help & FAQs

Frequently Asked Questions

Clear answers to common questions to help you use this calculator confidently.

What is the monthly payment on a £20,000 car?

Tap to view the answer

Enter the car price (£20,000), your deposit, APR, and term to estimate a monthly repayment in GBP. The monthly figure may look affordable while the total interest is still significant, so compare low, base, and high APR scenarios.

Does car finance work differently across the UK (England, Scotland, Wales, Northern Ireland)?

Tap to view the answer

The repayment maths is the same, but dealer availability, insurance costs, and regional prices differ, and some locations face more affordability pressure because of wages and commuting needs. The tool works anywhere in the UK and shows results in GBP (£).

What are the most common mistakes people make with car finance?

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A common one is focusing only on the monthly payment and ignoring the total payable, fees, and interest. Another is adding extras like warranties and GAP insurance without checking the total cost. Staying honest about affordability avoids both.

How does FCA guidance relate to car finance?

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FCA guidance encourages comparing finance offers, understanding the total payable, and checking affordability before committing. Showing the real long-term cost supports that, but it isn't official FCA advice and doesn't replace reading your agreement.

How do Bank of England interest rates affect car finance?

Tap to view the answer

Broader interest rate trends influenced by the Bank of England can affect borrowing costs across the market over time. The calculator doesn't predict APR changes, but it lets you model higher or lower rate scenarios — updating yearly reduces surprises.

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How to Use This Calculator

Enter Car Price

Enter the total on-road price of the car you plan to buy, including taxes and registration fees.

Choose Finance Type

Select PCP, Hire Purchase (HP), or Car Loan depending on how you want to finance the vehicle.

Add Deposit & Balloon (if applicable)

Enter your upfront deposit. For PCP, also enter the expected balloon (final) payment.

Set APR and Term

Enter the interest rate (APR) and loan term in months or years.

View Monthly Repayments

Instantly see your estimated monthly payment, total interest and total repayable amount.

Understanding Your Results

Monthly Payment
The amount you are expected to pay each month for your selected finance option.
Total Interest
The total interest paid over the entire finance term based on APR and loan length.
Total Repayable
The overall amount you will repay including deposit, interest and any balloon payment.
Balloon Payment (PCP)
A large final payment required to own the car outright under PCP agreements.

Key Tips

✓
Compare PCP vs HP Carefully: PCP usually has lower monthly payments but includes a balloon payment. HP leads to full ownership with no final lump sum.
✓
Watch the APR: Even small changes in APR can significantly affect total interest paid.
✓
Bigger Deposit = Lower Cost: A larger deposit reduces monthly payments and overall interest.
✓
Check Affordability: Ensure repayments fit comfortably within your monthly budget.

Understanding Car Finance in the UK

What is PCP (Personal Contract Purchase)?

PCP is a popular UK car finance option that offers lower monthly payments by deferring part of the car’s value into a final balloon payment. At the end, you can return the car, pay the balloon to own it, or part-exchange.

What is Hire Purchase (HP)?

Hire Purchase spreads the full cost of the car over fixed monthly payments. Once the final payment is made, you own the vehicle outright.

Car Loan vs Dealer Finance

A personal car loan is unsecured and can sometimes offer better rates. Dealer finance (PCP/HP) may include incentives but can carry higher APR.

How APR Affects Cost

APR reflects the true cost of borrowing. Lower APR means less interest paid over time.

Formula & methodology

Formula used

Amount financed

P = car price − deposit + fees

The deposit reduces what you borrow; arrangement and dealer fees added to the agreement increase it.

PCP monthly payment

M = (P − B ÷ (1 + i)^n) × i × (1 + i)^n ÷ [(1 + i)^n − 1]

On a PCP only the balance above the optional final payment is amortised, after that final payment is discounted back to today.

HP monthly payment

M = P × i × (1 + i)^n ÷ [(1 + i)^n − 1]

Hire purchase amortises the whole amount financed, so the balance reaches zero at the end of the term.

Total amount payable

Total = (M × n) + balloon (if kept) + deposit

The real comparison between deals: everything paid across the agreement, not the monthly figure.

Variable definitions

Symbol	Meaning	Unit
P	Amount financed. Car price less deposit, plus fees added to the agreement.	£
B	Balloon / GMFV. The optional final payment on a PCP, capped at the amount financed.	£
i	Monthly rate. APR divided by 12.	decimal
n	Term. Length of the agreement in months.	months

Step-by-step calculation

1. Establish the amount financed
Take the car price, subtract the deposit and add any fees.
2. Handle the balloon on a PCP
Discount the optional final payment to present value and amortise only the remainder.
3. Compute the monthly payment
Apply the annuity formula for the chosen structure and term.
4. Total everything payable
Add the payments, the deposit and — if you intend to keep the car — the balloon, to compare deals honestly.

Limitations

A lower PCP monthly payment does not mean cheaper finance: it defers a large final payment. Compare total amount payable instead.
Mileage limits and condition standards are central to PCP agreements and are not modelled — exceeding them adds per-mile and damage charges at the end.
Depreciation, insurance, road tax, servicing and fuel are excluded; this covers the finance only.
The Guaranteed Minimum Future Value is set by the lender from projected residual values, and is not something this calculator can predict for a specific car.
Representative APRs need only be offered to 51% of accepted applicants, so the rate you are quoted may be higher.
On both PCP and HP you do not own the car until the agreement is settled in full.

Sources & references

RegulationCONC App 1.2 — Total charge for credit rules (APR calculation) — Financial Conduct Authority Handbook

Defines how APR and the total charge for credit must be calculated for UK consumer credit — the basis of the periodic rate and total-repayable figures this calculator produces.

RegulationCONC App 1.1 — Total charge for credit rules for agreements secured on land — Financial Conduct Authority Handbook

Companion rule set defining which charges form part of the total charge for credit, which is why the fees entered here change the total repayable and not only the monthly payment.

Calculator inputs

Vehicle Details

Finance Details4 options

Additional Costs4 options

Usage Assumptions1 option

Your results

Sources & methodology

Formula & methodology

Formula used

Amount financed

PCP monthly payment

HP monthly payment

Total amount payable

Variable definitions

Step-by-step calculation

Limitations

Sources & references

What is the monthly payment on a £20,000 car?

Does car finance work differently across the UK (England, Scotland, Wales, Northern Ireland)?

What are the most common mistakes people make with car finance?

How does FCA guidance relate to car finance?

How do Bank of England interest rates affect car finance?

Related calculators

More United Kingdom calculators

Calculator inputs

Vehicle Details

Finance Details4 options

Additional Costs4 options

Usage Assumptions1 option

Your results

Sources & methodology

How to Use This Calculator

Example UK Car Finance Calculation

Understanding Your Results

Key Tips

Understanding Car Finance in the UK

What is PCP (Personal Contract Purchase)?

What is Hire Purchase (HP)?

Car Loan vs Dealer Finance

How APR Affects Cost

Formula & methodology

Formula used

Amount financed

PCP monthly payment

HP monthly payment

Total amount payable

Variable definitions

Step-by-step calculation

Limitations

Sources & references

How to Use This Calculator

Example UK Car Finance Calculation

Understanding Your Results

Key Tips

Understanding Car Finance in the UK

What is PCP (Personal Contract Purchase)?

What is Hire Purchase (HP)?

Car Loan vs Dealer Finance

How APR Affects Cost