How Does Classic Car Financing Work?

Classic Mercedes driving down the road

Whether it’s a first generation Ford Escort or an iconic Porsche 911, classic cars hold a special place in the hearts of motoring enthusiasts. Yet for many Brits, the path to classic car ownership can seem complex, especially when it comes to financing. Not to worry, we’re here to help.

In this practical guide, we’ll answer all your questions about how classic car financing works. We’ll unpack how classic car loans work, break down the application process and explore the different financing options available in the UK.

Understanding classic car financing

How does classic car financing work compared to standard auto loans? While the pair share many similarities, it’s important to understand the differences between the two. Classic car loans are designed with vintage automobiles in mind, which means there are some unique factors that come into play:

Age

In general, a car must be at least 15 years old to be considered a classic. This is the age cited by HMRC in the official definition of a classic car.

Vintage appeal

While cars become eligible for classic status at 15 years or older, lenders also factor in vintage appeal. Vehicles from the post-war era, like the much-loved Morris Minor and iconic Aston Martin Atom, are generally favoured by lenders. That said, it’s not unusual for exceptions to be made for exceptionally rare or unique models.

Condition

The overall condition of cars plays an important role in securing finance. For example, lenders are far more likely to finance a Morgan Plus 4 roadster in mint condition than the same model in need of serious work.

Documentation

Lenders won’t always take your word for it when it comes to factors like age and condition. This is where documentation comes in useful. Anything related to the vehicle’s background, service history and overall vintage appeal can help improve your chances of securing classic car finance.

Market value

Lenders will usually assess the market value of the classic car before extending financing. Potential appreciation may also be considered. Typically, lenders will want to see a value of at least £15,000. Factors like condition, rarity, historical significance, documentation and desirability can all influence the appraised value of the car and ultimately, eligibility for finance.

Classic car financing options

Now you know more about how classic car financing works, let’s take a closer look at some of the different payment plan options available in the UK. Like standard auto loans, classic car finance agreements are designed to cater to different needs and preferences.

Hire Purchase (HP)

Simple and easy, HP agreements start with an initial deposit followed by fixed monthly payments to repay the total purchase price of the classic car, plus interest. When the contract is complete and the loan is fully paid off, legal ownership of the vehicle transfers to the driver. The HP model essentially sees the lender purchase the car outright, then provide the borrower with a structured payment plan.

Personal Contract Purchase (PCP)

Lower monthly payments make PCP one of the most popular ways to finance a classic car. Instead of covering the total purchase price of the car, monthly payments cover the cost of renting the vehicle from the lender for a set period, generally three to five years. At the end of the contract, you have the option to make a ‘balloon’ payment to cover the remaining value of the vehicle and purchase the car outright. Alternatively, simply return the vehicle to the lender, as long as the vehicle is in good condition, in line with the contract terms and within the agreed mileage.

Personal Loans

How does classic car financing work for a personal loan? This option sees lenders extend lump-sum financing to cover the full purchase price of a classic car. As well as the total purchase price, monthly repayments factor in interest and other fees.

Get behind the wheel of a classic with My Car Credit

Ready to embrace the joys of vintage motoring? At My Car Credit we specialise in securing auto finance loans for all kinds of vehicles, including classics. Give our online finance calculator a try and find out how My Car Credit can help you obtain that classic car of your dreams.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

Return to Car Finance Options
Return to search

Related articles

Will I Get Accepted for Car Finance?

Read More

Advantages of Cars on PCP with No Deposit

Read More

PCP Finance Explained – Personal Contract Purchase Guide

Read More
My Credit Rating

Excellent

  • You are a home owner
  • You have been on the electoral role for a long period of time
  • You have current credit arrangements and mortgage with no defaults
  • You have no CCJs, credit arrears or missed payments
  • You rarely apply for credit
  • You are employed or self-employed

Good

  • You are on the electoral role
  • You are a home owner or long standing tenant
  • You have a stable employment history
  • You have current credit arrangements with occasional missed payments
  • You have no CCJs

Fair

  • You are or have recently been on the electoral role
  • You may have recently changed address
  • You may have occasional missed payments
  • You may have an old CCJ
  • You may have regularly applied for credit

Poor

  • You may have had frequent changes in address
  • You may not be traceable on the voters roll
  • You may have exceeded credit card limits
  • You may have missed payments on current agreements
  • You may have had a CCJ in the past

Bad

  • You may not be traceable on the voters roll
  • Your credit cards are over their limits
  • You have recent CCJs
  • You may have been refused credit elsewhere
  • You may be in a debt management plan
£

X monthly repayments of
£X

Typical rate

Loan amount

Total payable

X% APR*

£X

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

Evolution Funding Limited, trading as My Car Credit, is a credit broker and not a lender.

Please ensure you can afford the repayments for the duration of the loan before entering into a credit agreement.

*Initial application is a soft search. Should you progress, some lenders may perform a hard search on your credit file.
Reviews.io 5 star logo
TrustPilow 4 star logo

Require more help?

Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!

Email
or call 01246 458 810

What is a Digital Dash – and Is It Worth It?

Alfa Romeo digital dash at night

The car market keeps evolving at an increasingly fast rate. From self-driving vehicles to cars with integrated face recognition, it seems like there’s a brand-new innovation every other week. One of these innovations is the digital dashboard – often abbreviated to digital dash. But what is a digital dash exactly?

Traditionally, car dashboards feature analogue clusters with gauges and lights that convey vital information to the driver. Most classic dashboards include the same things – a fuel gauge, a speedometer, a tachometer, warning and information lights and an odometer. This compact cluster is still an essential component for digital dashboards. So, what has changed?

Digital dashboard vs classic dashboard

Although the Aston Martin Lagonda was the first car to have a truly digital dash in the late 70s, it wasn’t until the 21st century that digital dashboards became commonplace. Before then, only luxury cars such as the Mercedes S-Class had digital dashboards. But that has changed. These days, you can even fit a classic city car like the Ford Fiesta with a digital dash.

So, what is a digital dash’s main benefit? That’s simple – it’s often completely customisable, meaning that you choose the information you want to see. For example, some digital dashboards include real-time information on a car’s engine, motor and battery. Other drivers prefer to prioritise fuel economy and customise their digital dash so it shows savvy gas-saving tips.

Since you can configure your digital dash to display sat nav instructions, this innovation has made things easier for drivers with a poor sense of direction. Unlike traditional sat navs, this allows drivers to make sure that they’re on the right path without taking their eyes off the road.

Is a digital dash worth it?

In the end, the answer to this question comes down to personal preference. For some drivers, digital dashboards with too much information can be a dangerous distraction. For others, it’s merely a question of looks. Some drivers just happen to prefer the retro feel of a classic dashboard and value that over the convenience of a digital dash.

That being said, a digital dash is a highly recommended add-on if you drive an electric car. In fact, most EVs these days will include a digital dash as the standard option. Why is this? Because, more so than petrol cars, EVs demand drivers to keep an eye on their car’s range and battery consumption at all times. A digital dash can show how many miles you’ve got left and where your nearest charging point is.

So, if you drive an EV, make sure you get a digital dash. It really is a no-brainer.

Helping you drive the car of your dreams

Not sure if your credit score is high enough to finance the car you’re looking for? Don’t worry. With our car finance checker, you’ll be able to find out whether you’re able to afford your car – and all without affecting your credit score.

Want to know more? Ring us on 01246 458 810, or email us at enquiries@mycarcredit.co.uk.

Rates from 9.9% APR. Representative APR 10.9%

Evolution Funding Ltd T/A My Car Credit

Return to Motoring Advice
Return to search

Related articles

Car Finance vs Personal Loan, what’s best for me?

Read More

Car Finance or Personal Loan – Which is Best for You?

Read More

How Many Years in a Car Loan Term?

Read More
My Credit Rating

Excellent

  • You are a home owner
  • You have been on the electoral role for a long period of time
  • You have current credit arrangements and mortgage with no defaults
  • You have no CCJs, credit arrears or missed payments
  • You rarely apply for credit
  • You are employed or self-employed

Good

  • You are on the electoral role
  • You are a home owner or long standing tenant
  • You have a stable employment history
  • You have current credit arrangements with occasional missed payments
  • You have no CCJs

Fair

  • You are or have recently been on the electoral role
  • You may have recently changed address
  • You may have occasional missed payments
  • You may have an old CCJ
  • You may have regularly applied for credit

Poor

  • You may have had frequent changes in address
  • You may not be traceable on the voters roll
  • You may have exceeded credit card limits
  • You may have missed payments on current agreements
  • You may have had a CCJ in the past

Bad

  • You may not be traceable on the voters roll
  • Your credit cards are over their limits
  • You have recent CCJs
  • You may have been refused credit elsewhere
  • You may be in a debt management plan
£

X monthly repayments of
£X

Typical rate

Loan amount

Total payable

X% APR*

£X

£X

*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 10.9%, annual interest rate (fixed) 10.87%, 47 monthly payments of £191.50 followed by 1 payment of £201.50 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,702, total amount payable £9,202.

Evolution Funding Limited, trading as My Car Credit, is a credit broker and not a lender.

Please ensure you can afford the repayments for the duration of the loan before entering into a credit agreement.

*Initial application is a soft search. Should you progress, some lenders may perform a hard search on your credit file.
Reviews icon
TrustPilot icon
Trustpilot

Require more help?

Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!

Email
or call 01246 458 810