Frequently asked questions

Here are some of the most frequently asked questions about Car Finance.

What you need to know

Who is eligible for Car Finance?

You could apply for Car Finance if you’re buying a new or used car from a selected dealership, are 18 years old or over, a resident in the UK, have a Lloyds Bank current account of 3 months or more, are registered for Internet Banking.

Are there any restrictions on which car I can buy?

We offer finance for new and used cars at the majority of UK dealerships. There are some restrictions relating to make/model, age and mileage of the car, and we can't finance commercial vehicles. After you enter the details for the car you want to buy, we’ll tell you if our finance is available for that car.

We do not finance commercial vehicles, motorcycles or leisure products such as caravans and motorhomes. Other limitations based on the vehicle may apply

Can I part-exchange my current car?

We don’t currently offer part exchange as part of our Car Finance however you could arrange a part exchange with the dealership, who can settle any existing finance on your vehicle, if applicable.

Can I use any car dealership?

We work with the majority of UK dealerships - you can search by your location or postcode to find out which dealers we currently work with, once logged on to Internet Banking.

Can you arrange for the car to be delivered to me?

We don’t currently offer a delivery service as part of our Car Finance, however you could arrange this directly with the dealership. They may be able to offer you a contactless delivery service.

How do Lloyds Bank pay for my car and how long will it take?

We transfer the finance amount to the dealership directly as soon as you've signed the legal documents online. It can take several hours for the money to be received. Payments made after 2.30pm will be with the dealership before 12pm the following day.

Do you offer Car Finance for motorbikes or vans?

Unfortunately not, our finance is only available for cars.

Can I use your Car Finance to buy a car for business purposes?

Unfortunately not, you can only take Car Finance for personal, not business purposes.

If I finance a vehicle, am I able to register the car in another family member's name?

We do not allow the vehicle to be registered in another family member’s name. The person applying for finance should be the registered keeper of the vehicle, have a valid driving licence permitting them to use the vehicle and also be the main driver.

Can I transfer my agreement to someone else?

No, you cannot transfer an agreement to someone else.

Do I have to be on the voters/electoral roll to get approved for Car Finance?

Not necessarily, although this could affect your credit score, if you’re not.

Why do I need Internet Banking?

Lloyds Bank Car Finance is an online offer only. Once you've registered for Internet Banking (it’s easy to register and only takes a few minutes) you can use the personalised calculator to see what each Car Finance option could look like for you.

Register for Internet Banking.

What paperwork will I need?

You will not need to provide any paperwork and details of your finance agreement will be sent to you by email. You should read all paperwork carefully and store it in a safe place. We’ll send you a welcome letter which confirms your monthly payments and direct debit details.

Is car insurance included as part of Car Finance?

Car insurance is not included as part of the finance we offer although it is available separately. Please note we need the car to be comprehensively insured.

Potential fees at the end of your agreement

Potential fees at the end of your agreement

At the end of your agreement	Purchase fee - This is optional, but you must pay it if you want to become the owner of the Vehicle. It is included in the Final Repayment.	£10
Excess mileage fees - Applicable on PCP only if you choose to return the vehicle at the end of your agreement instead of paying the final lump sum)	If you exceed your agreed mileage	If your engine size is up to 1.6 litres = 8.4p per mile If your engine size is more than 1.6 litres up to 2.0 litres = 12.6p per mile If your engine size is more than 2.0 litres = 16.8p per mile If your car is electric = 9.6p per mile (All excess mileage fees shown are including VAT at 20%)

Additional Information:

The vehicle must be in good condition, you will be charged for any repairs outside the acceptable fair wear and tear if this is not the case. You can avoid these charges by taking good care of the vehicle.
If you have exceeded the agreed mileage allowance, you will need to pay an excess mileage charge. You can avoid this by agreeing a realistic mileage at the outset.

How to apply expandable section
I'm not a Lloyds Bank customer - can I apply?

No - our Car Finance offer is for existing customers who have held a Lloyds Bank current account for more than 3 months, are UK residents and aged 18 and over

How does the application work?

Applying for Car Finance is straightforward:

Use our calculator to compare your personalised options.

Enter the details or the car and dealership. You can use the ‘Find dealer’ section to check if a dealership is eligible before completing the application.

We’ll complete an affordability assessment and, subject to your application being accepted, you’ll receive an offer that’s valid for up to 90 days.

Enter the dealership’s bank details, so we can pay them direct and complete the finance agreement.

What details do I need before I apply?

Once you’ve found the car you want to buy, we’ll need:

dealer or current finance provider's name, postcode and bank account details

the car registration number

current and expected yearly mileage

the price and deposit

your financial details, including your monthly income and existing finance commitments.

If it’s a new car, we’ll also need:

The delivery date of your car.
The full vehicle details, if you don’t know the registration yet.

If you’re refinancing other car finance, you’ll also need your settlement figure and the name of the provider.

What is a settlement figure and how do I get one?

This is the exact amount needed to end the agreement you have with your current finance provider. You’ll need to get in touch with your current finance provider and ask them to send this to you.

Can I make a payment towards my settlement figure?

Yes, you can do this if your existing provider allows you to. You’ll need an up-to-date figure before you submit your application though, so if you make a payment after submitting your application, the settlement figure and amount you want to borrow will no longer match, and your application will be declined.

This won't affect your credit file, but you’ll have to start a new application with an updated settlement figure to continue.

You can make extra payments to us at any time without any charges or fees.

Can I apply in branch?

Car finance is an online offer only so you can't apply in branch. If you do have any questions you can call us on +44 (0)333 202 7969 and we’ll be happy to help. Please note, you won’t be able to apply over the phone.

How many applications can I make?

You can make as many applications online as you like, without any credit searches because you’re already our personal current account customer and we’ll keep the offer for you, up to 90 days. However, you can only have one application saved at a time.

Can I apply using my joint account?

Providing you’re eligible you can apply using your joint account but the application will be registered against the customer that is currently signed in. This means the Car Finance contract will be in one name only and can only be administered by that customer.

When completing the application the answers you give should only reflect your individual circumstances

Income should be entered as your personal income not the full household income

Outgoings should be entered as your contribution to those costs.
When your plan is ending expandable section
What if I want to change my car before the end of the term?

You’ll need to request an early settlement figure from us, which you can do online, and settle your current contract before you change the car. You’ll also have the option to voluntarily terminate your contract. Our customer service team will be able to give you details of the early settlement balance or more information about voluntary termination, and the steps you’d need to take.

Should you decide to voluntarily terminate your agreement you will need to return the car and have paid half of the total amount payable as detailed on your agreement documentation. If you have already paid at least this amount plus any overdue repayments and have taken reasonable care of the car, you will not have to pay any more.

What if I decide I want to keep the car?

If you decide to keep the car you will need to pay the final payment (Fixed HP Plan) or the final lump sum payment (Flex PCP). It is important that Flex PCP customers prepare for how they will make the final lump sum payment.

What happens if I decide to give the car back at the end of my Flex (PCP) Car Finance term and how do I return it?

We’ll contact you 90 days before the end of your finance agreement to outline the options you have. If you decide to return the car to us, you’ll need to call our customer services team on +44 (0)333 202 7946. We can either:

Arrange to pick the car up from you free of charge providing the car is driveable and road legal

Or, if you'd prefer you can return it to one of the authorised venues across the UK. If the car cannot be driven and requires a tow truck a charge may apply.

Once the car has been collected or returned, we’ll check the mileage and that it’s in good condition*. Providing that you have not exceeded the maximum agreed mileage and the vehicle is in good condition, we’ll write to you confirming that the agreement has ended and your Car Finance account is closed. If the vehicle has exceeded the maximum agreed mileage a charge per excess mile will apply.

Your finances

Will Lloyds Bank perform a credit search when I apply?

When you apply for Lloyds Bank Car Finance, we don’t need to do any additional credit searches, because we already know you. This means that you can browse your options and apply for Car Finance with no impact on your credit report. If you take out a Car Finance plan, this will be detailed on your credit report.

Can I transfer my existing Car Finance arrangements or do you offer finance consolidation?

Yes, we now offer re-finance on certain credit agreements taken out with other providers. Please contact us on 0333 202 7969 to discuss your options.

We don’t offer consolidation of finance, for example paying off a loan or credit card that you’ve bought a car with.

If you refinance existing debts, you may pay a higher rate of interest or make repayments over a longer term. This means that you may pay more interest overall.

To see if you’re eligible to apply for re-finance, see ‘Who is eligible for Car Finance?’ section.

What is the lump sum on the Flex (PCP) option?

The lump-sum is a one-off optional payment due at the end of your (PCP) finance term, if you decide to keep the car. This is normally referred to as the Guaranteed Future Value (GFV) and is an estimated value of how much the car will be worth at the end of a finance agreement (based on your expected mileage and agreement term).

The GFV is only applicable if you intend to hand the car back at the end of the agreement as part of the goods return option. There’s no lump sum payment on the Fixed (HP) finance option, which is why monthly payments are usually higher than with the Flex (PCP) option.

What does APR mean?

APR stands for Annual Percentage Rate and is the amount of interest on your total borrowed amount that you'll pay annually (averaged over the full term of the loan). APR’s are typically used when comparing finance options to understand which would be the cheapest option overall.

What's the difference between Car Finance and an unsecured personal loan?

Extra protection If you use Car Finance instead of an unsecured personal loan to buy your car you’ll benefit from extra consumer protection. The Consumer Rights Act applies which means the finance company has responsibility for the quality of the goods and to resolve any issues with the dealership if they are not of the required standard.

Voluntary termination rights Under the Consumer Credit Act 1974 you have a right to end any regulated Hire Purchase (HP) or Personal Contract Purchase (PCP) agreement at any time before the final repayment under your agreement, becomes due. This is known as voluntary termination and is detailed in the ‘Termination: Your Rights’ section on your credit agreement.

You also have the option to voluntary terminate your agreement. You will need to return the car and half of the total amount payable as detailed on your agreement documentation. If you have already paid at least this amount plus any overdue repayments and have taken reasonable care of the car, you will not have to pay any more.

Secured lending Car finance lenders use the car as security against the finance taken out, so if payments aren’t kept up, the car can be repossessed. For unsecured personal loans the lender doesn’t secure the finance against an asset (E.g. a car or a home).

The difference between Car Finance and an unsecured personal loan
	Car finance (PCP or HP options)	Unsecured personal loan
Car finance (PCP or HP options) Car ownership	Unsecured personal loan Don’t own car until the final payment	Own the car as soon as you purchase
Car finance (PCP or HP options) Loan purpose	Unsecured personal loan Can only use to purchase car	Could use for other purposes as well as car purchase
Car finance (PCP or HP options) Deposit required to take finance out	Unsecured personal loan Typically yes	No
Car finance (PCP or HP options) Extra protection	Unsecured personal loan Yes – protection under the Consumer Rights Act if something goes wrong and the right to terminate your regulated agreement under the Consumer Credit Act 1974.	No

What should I do with the dealership's invoice?

You can store your invoice with the rest of the cars documentation, as the invoice is for your record only. You may need this in future when title is transferred to you as proof of purchase.

How do I work out my deposit?

Your deposit is the amount of money you have available to pay the dealership upfront and could include savings and/ or the value of a current vehicle. For example:

Mr Jones is coming to the end of a 3 year existing Car Finance agreement, which is a PCP deal and wants to buy a different car. He has his eye on a car being sold at £13,200. His local dealership gives him a valuation of his current vehicle of £6,000. This is £500 higher than the amount required to settle the outstanding finance on his current car (£5,500) so he decides to use this as equity for his new car rather than return his current car to his current lender under the terms of his PCP deal. He will therefore pay the £5,500 to his current PCP lender and have £500 to use as a deposit on his new car. Mr Jones also has £1,000 cash savings. Using the £500 equity in his current car, plus his savings he has a deposit of £1,500 to pay directly to the dealership. When applying for Lloyds Bank Car Finance, Mr Jones inputs the price of the car as £13,200, his deposit as £1,500 and therefore his borrowing amount as £11,700.
Ms Singh owns her car outright but fancies a change. She has seen a car for sale at £8,000. The dealership offers her £1,750 for her current car which she accepts. Adding her cash savings of £250 to this gives her a deposit of £2,000. When applying for Lloyds Bank Car Finance, Ms Singh inputs the price of the car as £8,000, her deposit as £2,000 and therefore her borrowing amount as £6,000.

If you’re buying a car, we can offer you a new way to pay for it.

Lloyds Bank Car Finance could offer you a great rate of 3.8% APR Representative when you borrow between £7,000 to £25,000. You choose the deposit amount, length of term and payment options. At the end of your agreement, you can own or return you car, depending on the product you choose.

You can apply for Car Finance if you’re aged 18 or older, you’re a resident in the UK, and you’ve held a Lloyds Bank personal current account for more than 3 months.

Credit is subject to status and additional affordability checks.

Important legal information

Lloyds Bank plc. Registered office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales No. 2065. Lloyds Bank plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 119278.

Eligible deposits with us are protected by the Financial Services Compensation Scheme (FSCS). We are covered by the Financial Ombudsman Service (FOS).