5 Common Myths About Car Finance – Debunked
Car finance can be a confusing topic, and with so much misinformation out there, it’s easy to get the wrong idea.

Car finance can be a confusing topic, and with so much misinformation out there, it’s easy to get the wrong idea. To help you separate fact from fiction, we’re debunking five common myths about car finance so you can make informed decisions with confidence.
Myth 1: Car Finance Is Only for People with Perfect Credit
The Truth: While a good credit score can help you access better deals, car finance is available to people with a range of credit scores. Many lenders offer options specifically tailored for individuals with bad or limited credit histories.
What You Can Do:
- Check your credit score before applying.
- Look for lenders that specialise in bad credit car finance.
- Provide proof of a stable income to improve your chances.
Myth 2: You Need a Huge Deposit to Get Approved
The Truth: While having a deposit can reduce your monthly payments, it’s not always a requirement. Some lenders offer zero-deposit car finance, allowing you to secure a vehicle without upfront costs.
What You Can Do:
- Research zero-deposit options.
- Consider trading in your current car as a deposit.
- Save for a small deposit to access better deals.
Myth 3: You Can’t Sell a Car on Finance
The Truth: Selling a car on finance is possible, but there are specific steps you need to follow. The finance agreement must be settled before you transfer ownership to the buyer.
What You Can Do:
- Contact your finance provider for a settlement figure.
- Pay off the remaining balance before selling.
- Consider using the sale proceeds to settle the loan.
Myth 4: Car Finance Is Always Expensive
The Truth: The cost of car finance depends on factors like the type of agreement, your credit score, and the interest rate. With the right deal, car finance can be an affordable way to spread the cost of a vehicle.
What You Can Do:
- Shop around and compare deals from different lenders.
- Negotiate terms with dealerships or brokers.
- Check the APR (Annual Percentage Rate) to understand the true cost.
Myth 5: You’re Stuck with the Car Until the Agreement Ends
The Truth: Many finance agreements offer flexibility. For example, Personal Contract Purchase (PCP) agreements often allow you to return the car, pay a balloon payment to own it, or upgrade to a new vehicle at the end of the term.
What You Can Do:
- Review your finance agreement for flexibility options.
- Speak to your lender about early termination or upgrades.
- Explore refinancing if you want to change vehicles.
Want to know more?
Understanding the facts about car finance can save you time, money, and stress. By debunking these common myths, you can approach car finance with confidence and find a deal that works for you.
If you have questions or need help navigating car finance options, contact carloans 365. Our team is here to provide expert advice and support tailored to your needs.