How much can I borrow for car finance?

When it comes to car finance, everyone's situation is just that little bit different from the next person.

As such, the amount you can borrow for the likes of financing a car can differ depending on your own personal circumstances.

How much money can I borrow for a car?

When considering applicants for credit, finance lenders are looking for evidence of stability and affordability.

As such, the more you can showcase these two aspects, the more you're likely to be able to lend.

What affects how much I can borrow?

With stability and affordability the two key factors to how much you can lend, the following are where you'll typically need to show evidence of the two:

Annual Income: this is the amount that you earn per year, including your salary and any additional income. Not only does a job show stability, but the amount you earn will also play a big part in your affordability.

Monthly Commitments: this considers your monthly commitments to pay for bills and other expenses. The more you earn through your income versus your outgoings, the more you can show evidence of affordability.

Term Length: this is the length of time your agreement will run. If you spread the cost of your car over a longer period, lenders are likely to lend you more money, as you can manage your costs over time.

Credit History: this is a record of how you use credit, and indicates to lenders if you have a good track record of making payments on time. If you have a bad credit history, lenders will see you as more of a risk and may not lend as much money to you.

It is important to remember that if you are taking out a secured loan on a car through your lender, you may have your car repossessed if you do not make the payments.

How much money can I loan from a bank?

If you borrow money for a car from a bank, the amount that you can borrow may vary.

A personal loan is an unsecured loan, so you don't require collateral, but you may experience higher interest rates.

If you miss a payment on a loan, you may be charged a fee, plus interest. If this happens repeatedly, the lender may issue a County Court Judgement (CCJ), which will negatively impact your credit score.

However, with car finance through a dealer, such as Stoneacre, the loan is secured against the car.

With a secured loan on your car, your vehicle can be repossessed if you do not make the payments. This offers our lenders a safety net, meaning they are more likely to lend money to you.