No Deposit Car Finance
What’s your monthly budget?
Rates from 9.9% APR. Representative APR 13.9%. We are a credit broker, not a lender.
Representative example: Borrowing £7,500 over 60 months with a representative APR of 13.9%, flat rate of 7.25% and deposit of £0.00, the amount payable is £170.98 per month, with a total cost of £2758.68 and a total amount payable of £10,258.80.
Get your car, then pay nothing for 30 days
Don’t let a chunky deposit stand in the way of you getting a new car. If you haven’t got cash to put down up front, a no-deposit car finance deal spreads the cost across your monthly payments instead.
What is no-deposit car finance?
In a typical car finance deal, whether that’s a personal contract purchase (PCP), hire purchase (HP) or personal contract hire (PCH) agreement, you’ll be asked if you want to put down a deposit (otherwise known as an initial payment) upfront. This is usually around 10% of the total cost of the agreement but can be adjusted to be higher or lower.
A no-deposit deal simply removes the upfront payment from the equation, instead spreading the entire cost of the agreement across your monthly payments. Why? Because not everyone can afford an initial payment that’s usually around a few thousand pounds. So, if you can afford to spread the cost of a car finance deal but don’t have the money upfront for a deposit, a no-finance deal could be the answer.
How does no-deposit car finance work?
Other than removing the initial payment element, no-deposit deals don’t work much differently from any other. Paying nothing upfront will affect the costs attached to the rest of your deal, but no-deposit car finance can generally be broken down into a few simple steps:
- Choose your preferred financing method
No-deposit options are available across all types of finance, including the two most popular: PCP and hire purchase.
- Check your eligibility
Our free soft credit check will let you know if you’re likely to be approved for finance without affecting your credit score.*
- Choose no deposit
Once you’re pre-approved and know what type of finance deal you’d like, simply select a no-deposit option to see a breakdown of costs for your chosen vehicle. Going no deposit means the cost of your agreement will be spread across higher monthly payments. As long as they’re affordable, you’re good to go.
What no-deposit finance options are available?
No-deposit options can be found across all our car financing packages:
PCP is the most popular form of car financing in the UK, thanks to its flexibility. Unlike other types of financing, PCP allows you to choose what you want to do with the car at the end of the agreement. You have the option to buy the vehicle by paying a one-off balloon payment, return it and walk away with no further obligation or, in some cases, part exchange it in a new deal.
PCP deals typically start with a deposit of around 10% of the total deal cost, but no-deposit options are readily available, with any proposed upfront cost instead spread across fixed monthly payments.
Hire purchase is another popular method of financing a vehicle, but it’s structured towards buying the car at the end of the agreement. Like PCP, a HP agreement is typically made up of an upfront deposit and fixed monthly payments, but there’s no optional balloon payment at the end. Instead, once you make your last monthly payment plus a small option-to-purchase fee, the car is yours.
A no-deposit HP deal spreads the entire cost of the deal across the monthly payments.
Conditional sale is a more uncommon form of car finance that’s very similar to hire purchase in that you’re obligated to buy the car at the end of the deal. The only real difference is there’s no option-to-purchase fee or additional admin requirements to transfer ownership of the vehicle – you simply make the last monthly payment and the car is yours.
The pros of no-deposit car finance
No deposit car finance is all about accessibility. With the initial payment often being a stumbling block for customers without a lump sum of cash to put down, a zero-deposit agreement offers an affordable route to driving the car you want. However, it’s important to understand how it affects the rest of the deal.
No upfront cost
Having nothing to pay upfront makes the package more affordable for those who don’t have savings set aside for a deposit.
Keep your savings intact
If you do have savings but would rather keep them in place or use them elsewhere, a no-deposit deal allows you to do that.
Spread cost evenly
Know what you’re paying every month with the total cost of the deal (excluding the balloon payment if you go for PCP) spread evenly across fixed monthly amounts.
Disadvantages of a no deposit car finance
- Higher monthly payments
Paying nothing upfront means you’ll have more to pay across the course of your deal, which means higher monthly costs.
- More to pay overall
Your deposit is deducted from the total amount you borrow. So, if you go for a no-deposit deal, you’ll be borrowing the full amount and being charged interest on a bigger loan.
- Commitment to the full contract
As the lender is loaning more and therefore taking on more risk, no-deposit deals often demand stricter eligibility criteria.
Why get a no-deposit deal with Hippo Finance?
- Zero deposit and bad credit specialists
We’re zero deposit and bad credit specialists, so if you’re worried about finding a no-deposit deal you’ll be approved for and can manage, we’re expertly placed to help.
- Get an approval decision in minutes
You can find out if you’re likely to be approved for finance today with our free soft credit check. You’ll typically get an approval decision in minutes,** and applying won’t affect your credit score.*
- Used Car Promise
Every used vehicle we finance comes with our Used Car Promise, which ensures you’re getting a quality motor. Between our 130-point inspection, 3-month warranty and minimum 6-month MOT, you can move forward with complete peace of mind.
- Same-day collection
With over 1,000 vehicles in stock today, you can find a no-deposit deal and drive away today with our same-day collection options – or get fast UK delivery to your driveway.
- Work with a dedicated account manager
We offer an end-to-end service that takes care of the car finance process for you. If you want to get a car on an affordable deal but don’t know where to start, that’s where our dedicated account managers come in. And we’re trusted, too – take a look at why we’re rated ‘Excellent’ on Trustpilot.
No-deposit car finance FAQs
Can I keep the car after paying off a no-deposit finance deal?
That depends on the type of car finance you take out. For example, if you go for PCP, you’ll have the option to own the car at the end of the deal, whereas if you opt for hire purchase or conditional sale, purchase at the end of the deal is compulsory.
How much can I borrow on a no-deposit finance deal?
No-deposit deals don’t tend to come with different borrowing limits than any deal where you put a deposit down. As long as you’re approved for the deal, you’ll be able to get the loan you need – our lenders can finance vehicles up to £100,000. The first step towards knowing where you stand is to get pre-approved using our free soft credit check.
Can I pay off a no-deposit finance deal early?
Yes, as with any finance deal, early settlement and trade-in options are available, depending on the type of finance you’ve chosen. The thing to note with no-deposit deals is that because you haven’t put anything down upfront, you’ll have less equity in the deal from the start. That means you’ll likely spend more time in negative equity, meaning early settlement will come at a higher cost for longer.
What vehicles are available with no-deposit options?
Zero deposit options are available on every vehicle in our range. All you need to do is find the vehicle you like and see if your credit works for a no-deposit deal with it. If you’d like to know more about your options, you can always contact one of our dedicated account managers.
What are the eligibility requirements for no-deposit car finance?
Lenders look at various factors when considering your eligibility for any finance deal, including things like your credit history, income and whether the deal is affordable for you. With no-deposit deals, entry requirements can be stricter because the lender is loaning more money and, therefore, taking on more risk, so you might find there are certain deals available to you if you’re willing to pay a deposit but unavailable to you if you’re not.
Can I get a no-deposit finance deal with bad credit?
As bad credit and zero deposit specialists, if anyone can help you get a no-deposit finance deal with poor credit, it’s us. We work with a panel of handpicked lenders, many specialising in financing bad credit customers. Of course, it helps to have good credit when applying for any finance deal, but we’re proud to work with customers who otherwise get overlooked when trying to get a car they want on a deal that works. So, if you’re worried about bad credit, give us a call, and we’ll do our very best to help you.