In this brief blog, we are going to answer the question “What car can I afford in the Uk”.
What car can I afford in the UK?
When looking at what car you can afford in the UK you can either look at paying for the car upfront, financing the car or leasing it.
We can also look at what car you can afford in regards to new cars and used cars in the UK.
Paying for the New car upfront
If you are paying for the car upfront then, of course, your choice will be limited to the cars you can afford in the UK as you will have to ut a huge amount down to purchase the car.
What new cars can you afford in the UK?
£20,560 – £28,500
£13,645 – £19,509
£38,150 – £60,180
£13,620 – £19,170
£23,160 – £35,590
£12,165 – £17,015
£22,515 – £29,825
£24,570 – £41,555
£39,820 – £55,200
Financing a New car upfront
Financing a new car can either be with a personal contract purchase (PCP) or a hire purchase.
A personal contract purchase is when you pay a down payment and then take out a loan on the rest of the car. The loan is secured on the car. The personal contract purchase loan works by charging you for the depreciation of the car over the loan term as well as interest.
You will then have an option at the end of the loan term to pay one final balloon payment or return the car to the dealer. You may incur other costs if you go over your agreed mileage or if you haven’t properly maintained the car.
A hire purchase, on the other hand, is just a long term lease of a car, after which you will have to return the car. More often the hire purchase is the more expensive option out of the two but this depends heavily on how you structure your initial deposit on the hire purchase agreement.
If you are taking out a personal contract purchase agreement or a hire purchase agreement then you will find that the cards you can afford in the UK will increase as you simply have to make a monthly payment and or a one-off initial deposit.
What new cars can you afford in the UK with a personal contract purchase or a lease?
These are the cars you can afford in the UK for under £150 a month
Hyundai i10 Hatchback
Fiat Panda Hatchback
These are the cars you can afford in the UK for under £150 to £250 a month
To see what cars you can afford in the UK, you should use a car affordability calculator or search on Autotrader based on your budget.
In this brief blog, we discussed the question “what car can I afford in the UK”. If you have any questions or comments please let us know.
If you need financial advice and you live in the UK then you could contact the Money Advice service over the phone or via chat for impartial advice.
You can also contact the debt charity “Step Change” if you are in debt and need help.