Can I Buy A Used Car For Under £200 Per Month?

If you’re on a tight budget, you may be wondering whether it’s possible to own a used car for under £200 per month.🤔

The truth is how much you need to pay depends on your individual circumstances.

So, while it is possible to finance a car for less than £200 a month, you may be quoted higher depending on your situation.

Here we’ll explore the factors that contribute to £200 per month deals and share valuable tips to help you snag them.😀

Car Finance Deals Under £200 Per Month

The good news is it is totally possible to find car finance deals for under £200 per month.

However, their availability depends on the total loan amount, the length of the finance term, the interest rate, and your credit score.

For used cars, especially older models, or those with higher mileage, securing finance under £200 per month tends to be easier.

These cars typically have a lower purchase price, making them more accessible for buyers with a tighter budget.

To find the best deals, it’s important to shop around and compare offers from different lenders.

Keeping an open mind about the make and model of the car can also expand your options.

Tips to Get Cheaper Car Loans

If you want to improve your chances of securing a cheaper car loan, there’s a few things you can do.

Here’s our top tips for getting a car finance deal for less than £200 per month:

Improve Your Credit Score

A high credit score can significantly reduce the interest rate you're offered on a car loan.

To improve your score, focus on making timely bill payments, reducing overall debt, and ensuring your credit report is free from errors.

Regularly monitoring your credit score can also alert you to any changes or opportunities for improvement.

Remember, a good credit score reflects responsible financial behaviour, which lenders reward with better loan terms.

Shop Around

Don’t rush into accepting the first car finance offer you receive. Take your time to shop around and compare rates from various lenders, including banks, credit unions, and online lenders.

You can also use online car finance calculators to compare the cost with different lenders.

Consider a Larger Deposit

The more you can pay upfront, the less you'll need to borrow and the lower your monthly payments will be.

This also means you'll pay less in interest over the life of the loan.

Saving for a larger deposit takes discipline, but it’s an effective strategy that can lead to significant savings and a lower debt burden.

Lengthen the Loan Term

Choosing a longer loan term will increase how much interest you pay overall, but it drastically reduces the monthly payments.

With a longer-term loan, you’ll find it easier to get accepted for monthly payments under £200.

Choose a Less Expensive Car

Selecting a more affordable car can lead to substantial savings in your car finance.

Look for models known for their durability, reliability, and lower depreciation rates.

A less expensive car not only reduces the amount you need to finance but can also lead to lower insurance premiums and maintenance costs.

Refinance Your Loan

If you already have car finance, consider refinancing the loan to take advantage of better interest rates or better terms.

This is particularly effective if your credit score has improved since you took out the original loan.

Refinancing can lead to lower monthly payments or a shorter loan term, ultimately saving you money.

However, be sure to weigh any potential fees against the savings to ensure refinancing is beneficial in your situation.

Apply for Car Finance Under £200 a Month with Carmoola

At Carmoola, we pride ourselves on offering some of the most competitive car finance rates on the market.😍

Depending on your circumstances, you could secure fast, easy hire purchase finance for under £200 per month on a used car.

With Carmoola, you can find a reliable and affordable used car at a price that suits you.😎

Read more about car finance deals:

• How to Find the Best Used Car Finance Deal
• The Best Cars to Buy Under £20,000
• Can I Refinance My Car Loan to Get a Better Rate?