Guide to Car Loans

Applying through a car lender or car finance company

So once you have decided on which car finance company or lender option is right for you, it is now down to the actual application!

You'll need to get some documents together before you start, in most cases lenders and car finance companies will require you to provide:

  • some form of identification and proof of age (i.e. passport)
  • your driver's licence
  • proof of your permanent UK home address
  • proof of your salary or income
You must have a bank account suitable for direct debits.

As part of the application process lenders may also check your credit score, this is a score that is given to you based on your past credit history. If you want to find out what your credit score is for yourself, you can do this (for a small fee of around £2) at

In addition to the general application requirements above, the table below outlines what to expect when applying through a bank or finance company or a car dealership:

Applying for car loans & finance via... What to expect...
High Street Banks and Finance Companies Apply over the Telephone, Internet or in Branch. A specialist loan advisor, or auto instructions, will take you through the application process step by step. Your lending may be approved on the spot but may take longer depending on the type of loan or finance, usually 24 hours. Once your loan or finance is approved the funds will either be transferred into your bank account or your credit limit will be confirmed.
Car Manufacturer or Dealership Agree any deposit payable, fill in a credit or finance application form with the Salesperson, who will then contact their finance company for approval, this is usually done while you wait. If your finance is approved it is paid directly to the car dealership or manufacturer and you can usually drive the car away the same day.

Make sure you have read and understood the car finance and/or car loan agreements before you sign them because once you sign you have entered into a binding contract. Keep the car loans and finance agreements in a safe place for future reference along with related insurance documents.

Contact the lender or car finance company immediately if you can't make a repayment or get into financial difficulties to discuss your options and potentially avoid your car being re-possessed.

Download the Car Loans PDF Guide here - see our other free PDF guides here

Car Finance

What are car loans?
What do you need for new or used car loans?
What's the difference between car loans and car finance?
Things to think about when considering new or used car loans
Applying through a car lender or car finance company
Car Loan FAQs - eg. bad credit car loan
More helpful car loan links

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