Cautious motorists are under-borrowing on car loans

car buyers are under-borrowing

Motorists are no longer ‘maxing-out’ on their borrowing ability, and are increasingly opt for vehicles priced below the amount of the car loan for which they qualify.

This is according to Specialist Motor Finance (SMF), which says it will be reducing the minimum amount it is prepared to lend by 25 percent, enabling customers to fund a car costing as little as £3,000.

The company says it has identified the trend after analysing over £100 million of hire purchase (HP) advances it has made through finance brokers and dealers.

Its customers tend to be those whose credit profiles preclude them from using mainstream lenders, but who are not experiencing chronic financial difficulties.

Customers ‘being shunned’

Do you haggle when buying a new car? One in seven buyers don't – because they think it's RUDE

The company believes the research points to a rise in the number of financially incisive buyers who are “being shunned” by traditional lenders because of historic or minor credit problems.

David Challinor, managing director of SMF, said: “I think we are witnessing a reluctance among some customers not to take their borrowing to the limit, even when this has already been set at a realistic level.

“They would rather sacrifice the size of car they buy, or drop down a level of refinement, in order to create a bigger buffer between their income and outgoings.

“Even five-figure amounts we approve after demonstrating affordability are often drawn down as a lesser sum after the buyer imposes their own traffic light system for the loan.”

Finance drives used car growth

The market saw a 6.4 percent increase in used car finance in April, according to lead management experts Dealerweb. Chief executive Martin Hill said: “Used car operations continue to provide opportunities for growth as the new car sector continues to see headwinds.”

Meanwhile, the point of sale (POS) new car finance market reported a three percent fall in value and a five percent fall in value in March.

Toyota Aygo

Cars that cost less per month than an iPhoneX

Toyota AygoWhich would you rather have? A phone that’s too chunky for your pocket or a stylish and reliable nearly-new car? That’s (more or less) the question posed by used car website Auto Trader, which has equated the cost of an iPhone X with a 2015 Toyota Aygo. Both will set you back £113 a month.

Using its new car finance calculator tool, Auto Trader has also looked at other common monthly outgoings, working out which cars you could buy instead.

Two gel manicures a month or a 2015 Hyundai i10? We’ll take the car. Killing yourself slowly via 20 cigarettes per day or a 2017 Audi A1? No contest. A date night or a 2015 Vauxhall Corsa? We’ll get back to you on that.

 Monthly expenses           The car you could buy instead
 Apple iPhone X 64GB – £113            Toyota Aygo (2015)
 Night out in London (£60 x 4) – £240 Seat Ibiza (2018)
 Takeaways: £110 Peugeot 108 (2015)
 Cigarettes (1x pack of 20 per day): £321 Audi A1 (2017)
 Gel manicure (twice monthly) – £70 Hyundai i10 (2015)
 Blow-dry (£35 x 4) – £140 Suzuki Celerio (2017)
 Luxury subscription box service: £62 Toyota Previa (2014)
 Date night: £75 Vauxhall Corsa (2015)

If all the above cars sound a bit, well… boring, Auto Trader says that for the average amount spent monthly in coffee shops (£184), you could drive “a swanky vintage Porsche Cayenne.”

We’re not sure what the vintage Cayenne looks like (presumably it still has running boards and wooden wheels), but the idea sure sounds tempting.

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Used SUVs for less than £200 a month

Used SUVs for less than £200 a month

Used SUVs for less than £200 a monthAuto Trader has launched a new online tool, allowing car buyers to search for their next car based on their ideal monthly budget. Given the popularity of PCP (Personal Contract Purchase) plans, this should benefit the majority of people who visit the classifieds website. With this in mind, we’ve been on the hunt for SUVs and crossovers for less than £200 a month.

To focus the results, we narrowed the search to cars up to five years old with no more than 100,000 miles on the clock. We also used a range of deposit options, from zero to £2,500.

£0 deposit: Nissan Juke

Used SUVs for less than £200 a month

Once upon a time, an SUV meant tank-like styling and driving dynamics, four-wheel drive, and running costs to rival the national debt. Today, the lines between SUVs, crossovers and hatchbacks have become rather blurred, but to keep things simple we’ve used Auto Trader’s own filters to find a selection of SUVs for £200 a month. Like this Nissan Juke, which could be yours for £173.33 a month, with no deposit and an optional final payment of £3,474.58.

£0 deposit: Kia Sportage

Used SUVs for less than £200 a month

This one-owner Kia Sportage has covered 49,100 miles and is on sale for £9,779. Alternatively, you can drive away with no deposit and £199.74 a month over three years. The optional final payment is £4,471.50, with a fixed rate of interest of 3.97%.

£500 deposit: Hyundai ix35

Used SUVs for less than £200 a month

Increasing the size of the deposit from zero to £500 should, in theory, either lower your monthly payments or allow you to purchase a newer vehicle. This 2014 Hyundai ix35 has covered just 13,061 and is up for £9,950. With a £500 deposit, that works out at £199.97 a month, with an optional final payment of £4,649. You’ll pay nearly £2,400 in interest, mind.

£500 deposit: Dacia Duster

Used SUVs for less than £200 a month

The Dacia Duster is a refreshingly honest SUV, and this 2014 example even benefits from four-wheel drive. The 1.5-litre dCi engine delivers a reasonable amount of poke and low running costs, while the black lower bumpers and steel wheels mean you won’t cringe when you hit the odd rock or tree stump. Yours for £199.77 a month, with an optional final payment of £2,655.

£1,000 deposit: Mitsubishi Outlander PHEV

Used SUVs for less than £200 a month

Remember, these examples are for illustrative purposes only, and you can spend a few minutes fine-tuning your search criteria. If you fancy a shorter term and a larger deposit, simply adjust the settings. The Mitsubishi Outlander PHEV is a popular new car, so used examples are likely to be in-demand. Up the deposit to £1,000 and you can drive away in the plug-in hybrid SUV for £199.93 a month, with an optional final payment of £6,335.

£1,000 deposit: Volkswagen Tiguan

Used SUVs for less than £200 a month

Such is the popularity of the Volkswagen Tiguan, we doubt this 2013 example will be available for long. The S trim is hardly lavish, but this one-owner example does benefit from 4Motion four-wheel drive and that all-important VW badge. Pay £1,000 and it’s yours for £199.55 a month, with an optional final payment of £4,331.50.

£1,500 deposit: Jeep Renegade

Used SUVs for less than £200 a month

Increasing the deposit to £1,500 opens up a new world of opportunities, including some much newer vehicles. The Jeep badge gives the Renegade justification for the ‘SUV’ tag, even if this 2016 example is front-wheel drive. You’ll pay £199.98 a month, with an optional final payment of £6,075.

£1,500 deposit: BMW X1

Used SUVs for less than £200 a month

Given the choice between spending £200 a month on a brand new supermini or a used BMW crossover, many will be lured by the premium badge of the X1. This front-wheel drive example dates from 2013 and has 47,688 miles on the clock. The monthly repayments are £184.05 after a £1,500 deposit. You’ll need to find £4,680 if you decide to keep it in 2021.

£2,000 deposit: Peugeot 2008

Used SUVs for less than £200 a month

We’ve upped the deposit again, this time to £2,000, which is enough to secure this 2016 Peugeot 2008 with 9,100 miles on the clock. The spec includes cruise control, dual-zone climate control, 16-inch alloy wheels and rear parking sensors, while the monthly payments are £199.98. Optional final payment: £5,310.

£2,000 deposit: Vauxhall Mokka X

Used SUVs for less than £200 a month

With just 7,702 miles on the clock, this 2017 Vauxhall Mokka X is practically new and benefits from a 7-inch touchscreen, front and rear parking sensors, Apple CarPlay and Android Auto, cruise control and dual-zone climate control. You’ll pay £199.95 a month, with an optional final payment of £6,231.39.

£2,500 deposit: Nissan Qashqai

Used SUVs for less than £200 a month

With 4,092 miles on the clock, this Nissan Qashqai is practically brand new, even though it was registered in 2015. It begs the question: what has it been doing for the best part of three years? Predictably, it looks blemish-free, and it could be yours for bang on £200 a month. The optional final payment is £7,022.75.

£2,500 deposit: Audi Q3

Used SUVs for less than £200 a month

We conclude with this 2014 Audi Q3 SE Quattro with 19,000 miles on the clock. Spend £2,500 on a deposit and you’ll pay £199.63 a month, with an optional final payment of £8,142.73. Contact the local dealers to discover more about the cars mentioned here, and be sure to take a test drive before signing up for a PCP deal.

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Best 0% APR car finance deals

10 great 0% APR car finance deals for July 2017

Best 0% APR car finance dealsNobody likes paying more than they have to, so we’ve crunched the numbers to find 40 great 0% APR car finance deals. All offers here make use of Personal Contract Purchase (PCP) schemes, which offer reduced monthly payments. However, there will be final payment to make, should you want to keep the car after the finance agreement ends.

As with any finance product, always make sure you research what is affordable to you both now, and in case your circumstances were to change in the future. All the offers shown here are for illustration purposes only, are subject to status, and may be withdrawn at any time.

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Ford B-Max Titanium Navigator – £169 pcmBest 0% APR car finance deals

It might not be sexy, but the Ford B-Max does have sliding-door practicality. Titanium Navigator trim sounds fancy, and features 16in alloy wheels, climate control and a Sony navigation system.

You’ll need to find a £5,733 deposit here, and you’ll pay £169 for 36 months. Ford will also offer a £1,200 saving on selected models, while mileage of 9,000 per annum is included.

Nissan Pulsar DiG-T 115 Acenta – £169 pcmBest 0% APR car finance deals

Not everybody likes to stand out from the crowd, and the Pulsar slips somewhat anonymously into the family hatchback market. At least the Acenta has dual-zone climate control and 16in alloy wheels.

Nissan will offer you £500 to get into this Pulsar, but you’ll still need to find a £4,784.13 deposit to secure £169 per month for three years. Mileage is capped at 10,000 per year.

Renault Kadjar Signature Nav TCe 130 – £229 pcmBest 0% APR car finance deals

Taken by the Nissan Qasqhai, but wanting a mid-size crossover with more Gallic flair? If so, the Kadjar could be a strong contender with this 0% deal. Signature Nav includes a panoramic sunroof, Bose sound system, and full LED headlights.

Deposit £5,266 into the bank account of a Renault dealership, and you’ll be paying £229 per month for three years. As before, servicing for two years is included, and a 6,000-mile per annum limit applies.

Honda Jazz 1.3 EX – £189 pcmBest 0% APR car finance deals

Don’t save your pension, your grandchildren will only waste their inheritance once they get their hands on it. Instead, check out this deal on a new Honda Jazz, which includes five years’ complimentary servicing, said to be worth £1,195 alone.

A deposit of £2,761.06 unlocks this deal, and results in 36 monthly payments of £189. Contracted mileage stands at 10,000 per annum, but exceeding this costs just £0.03 a mile.

Toyota Yaris Hybrid Design – £189 pcmBest 0% APR car finance deals

As one of the smallest hybrids around, the Yaris has a certain niche appeal. On top of two years’ free servicing, you’ll also get privacy glass, 16in alloy wheels, cruise control and DAB multimedia system.

To pay £189 per month for 42 months, and cover 8,000 miles per year, you’ll need £3,501 for a deposit contribution. Toyota will also add in an extra £1,000 – how nice.

Jeep Grand Cherokee SRT 6.4 Hemi – £839 pcmBest 0% APR car finance deals

Buying a large SUV, powered by a giant 6.4-litre Hemi V8 engine, needn’t result in you paying more than 0% APR. But you’ll need the cash to fuel the Hemi’s thirst for unleaded.

Helpfully, Jeep will contribute £5,500 towards the deposit, along with an extra £2,500 discount for test-driving one before the 31st July. Buyers will then need their own £7,749 deposit, to secure paying £839 per month for three years. A 10,000-mile annual allowance applies.

Mazda 6 150ps Sport Nav Diesel – £259 pcmBest 0% APR car finance deals

Usually associated with business users, the Mazda 6 is available to private buyers with 0% APR deals. Sport Nav trim includes 19in alloy wheels, LED headlights, black leather seats and a Bose sound system.

You’ll need to make a substantial upfront deposit payment of £7,276.38, but Mazda will add an additional £2,500 to the deal. You’ll then spend 36 months paying £259, but a 9,000 miles per annum allowance applies.

Skoda Yeti Outdoor SE L Drive 1.2 TSI – £279 pcmBest 0% APR car finance deals

Time is running out before the Yeti becomes extinct, but there’s still time to bag a car from an era where Skoda still had a sense of fun. With a new Karoq on the way, the run-out Outdoor SE L is loaded with kit, including touchscreen satellite navigation, bi-xenon headlights and parking sensors.

Not only will Skoda contribute £1,500 as a deposit contribution, order by the 17th July and you’ll get £500 worth of free fuel, too. With a customer deposit of just £279, this will result in payments of £279 again for the next 42 months. This price includes an allowance of 10,000 miles per year.

BMW 730d M Sport – £520 pcmBest 0% APR car finance deals

Even high-flying executives can get in on the 0% finance deals and generous deposit allowances currently offered by BMW. The 730d M Sport would cost £70,300 in cash, but becomes less dramatic when financed over 48 months.

Buyers need a £8,587.40 deposit, with BMW topping things up with a further £10,936. Pay £520 per month for the four-year term, and keep the mileage below 10,000 per annum.

Lotus Elise Cup 250 – £0 pcmBest 0% APR car finance deals

The 0% finance deals offered by Lotus are slightly different than regular PCP deals, with no monthly payments, but the need to stump up half the the cost of the car from the outset.

For the Elise Cup 250, that means an initial payment of £23,275, followed by 23 months of paying absolutely nothing at all. Buyers will then, in theory, be in a position to pay the remaining £23,275, having had almost two years of interest-free motoring fun.

Best new cars for £150 a month or less

Best new cars for £150 a month or lessFew people look at the list price of a new car these days, with the monthly cost of a Personal Contract Purchase (PCP) the more relevant factor. With this in mind we’ve selected 10 new cars you can buy for £150 or less.

Mileage restrictions, interest and deposit contributions vary, so use this as a guide before contacting your local dealer. Images used are for illustrative purposes only.

Skoda Citigo 5dr Colour Edition: £135.00Best new cars for £150 a month or less

The Skoda Citigo is one of our favourite cars at any price. Right now, you can drive away in a five-door Colour Edition finished in Candy White paint for £135 a month. Skoda will contribute £1,000 to the deposit, leaving you to find £751.72 up front.

Hyundai i10 Premium 1.0: £148.21Best new cars for £150 a month or less

In Premium trim, the Hyundai i10 offers big car toys in a small car shell. If you can find £2,298 for the deposit, Hyundai will add £500, leaving you to spend £148.21 a month on this excellent city car. The less well-endowed S and SE models are even cheaper.

Volkswagen Polo Match Edition 5dr 1.0: £149.00Best new cars for £150 a month or less

With a new Polo waiting in the wings, Volkswagen is keen to shift stock of the outgoing model. The monthly payments for the Polo Match Edition are spread over 47 months and you’ll need to fork out £2,506.31 for the deposit. Volkswagen will add £1,800 to the pot.

Dacia Logan MCV Laureate TCe 90: £119.00Best new cars for £150 a month or less

The Dacia Logan MCV is Britain’s cheapest new estate car, with an impressive 573 litres of boot space. This 48-month deal includes a five-year extended warranty and a £500 dealer deposit contribution.

Renault Captur Expression+ TCe 90: £139.00Best new cars for £150 a month or less

The Expression+ trim isn’t the most generous in the sector, but it does offer air conditioning, cruise control, keyless entry and auto light/wipers. This 0% finance offer includes a £750 dealer deposit contribution. You just need to find £3,643 for the deposit.

Peugeot 108 Active Top: £145.04Best new cars for £150 a month or less

Finding a topless new car for £150 a month is going to be tough, but the Peugeot Active Top might be a good compromise. You’re limited to 6,000 miles a year and the interest rate is 4.9%, but you’ll pay £145.04 a month.

Suzuki Celerio 1.0 SZ2 5dr: £79.00Best new cars for £150 a month or less

Some people will spend more on a mobile phone contract than the monthly cost of this Suzuki Celerio. The entry-level SZ2 model is available for £79 a month after a deposit of £2,363. Just keep an eye on the 6,000-mile restriction and the 5.7% interest.

Ford Fiesta ST-Line: £139.00Best new cars for £150 a month or less

The ST-Line offers the styling of the Fiesta ST with some of the fun. Right now, Ford is offering a £1,000 saving on Fiesta ST Line, ST and ST200 models, with the ST Line available for £139 a month. The deposit: £4,788.

Nissan Micra IG-T 90 Tekna: £149.00Best new cars for £150 a month or less

It’s a Micra, Vera, but not as we know it. Nissan is hoping to shake off the Micra’s rather dowdy image and appeal to a younger audience with this bold new city car. The £149 a month deal includes a meaty £5,353 deposit, but at least there’s no interest to pay. The offer is based on 8,000 miles per annum.

Toyota Aygo X-Press: £129.00Best new cars for £150 a month or less

You’re limited to the same amount of miles in the Toyota Aygo X-Press, but you’ll pay £20 less for the privilege. Simply find £2,131 for the deposit and spend £129 a month for the next 42 months.

Car prices soar since Brexit, but you can bag these great deals

Car prices soar since Brexit, but you can bag these great deals

Car prices soar since Brexit, but you can bag these great dealsCar prices have risen 5.2% on average since the UK voted to leave the European Union in June 2016, costing the consumer nearly £2 billion. That’s according to data released by What Car? Magazine, which is urging consumers to “fight back” against surging new prices.

Vehicles costing less than £200 per month now make up 9.9% of the market, compared with 13% seven months ago. But What Car? says deals are still available and it has launched a new online car buying marketplace to make it easier to find them. These are the best discounts and finance deals available by segment.

Car prices soar since Brexit, but you can bag these great dealsCity cars, discount: Fiat Panda 1.2 Pop

Discount: 26.8%

The 1.2-litre Pop is the Fiat Panda at its most basic, with prices starting from £9,245. Not that you should be paying that, with What Car? suggesting that a 26.8% discount is available.

City cars, finance: Smart Fortwo Coupe

Finance: 3yr 0% APR PCP with a £140 deposit

The Smart Fortwo Coupe isn’t the cheapest city car on the block, with prices starting from £11,370. A three-year 0% PCP deal with a tiny £140 deposit makes it more appealing.

Car prices soar since Brexit, but you can bag these great dealsSmall cars, discount: SEAT Ibiza

Discount: 24.7%

There’s a new SEAT Ibiza on the way, so discounts will be available on the outgoing model. What Car? says you should be looking to save just under 25% across the entire range.

Small cars, finance: Mazda2

Finance: 3yr 0% APR PCP with a £750 deposit

The Mazda2 is a seriously underrated small car and a more exciting alternative to the Ford Fiesta and Vauxhall Corsa. Prices start from £12,595, although a three-year PCP deal is available with a £750 deposit.

Car prices soar since Brexit, but you can bag these great dealsFamily cars, discount: Citroen C4

Discount: 24%

The Citroen C4 isn’t the sharpest family car in the sector, but a 24% discount across the range makes it more attractive. Prices start from £15,595.

Family cars, finance: Skoda Rapid Spaceback

Finance: 3yr 0% APR PCP with an £1,800 deposit

The Skoda Rapid Spaceback majors on practicality, with plenty of rear legroom and up to 1,380 litres of boot space. A three-year 0% PCP deal is tempting, but you’ll need to find £1,800 for the deposit.

Car prices soar since Brexit, but you can bag these great dealsExecutive cars, discount Volvo S90 T4 SE Nav (Leather)

Discount: 21.4%

The Volvo S90 has only been on sale five minutes, but some seriously tempting discounts are available. If you were struggling to shift your attention away from the Germans, a 21.4% discount might sway you in the direction of the stylish Swede.

Executive cars, finance: Lexus IS

Finance: 3yr 2.9% APR PCP with a £3,000 deposit

Meanwhile, What Car? believes the best finance deal in the segment is the three-year 2.9% PCP offer available on the Lexus IS. You’ll need to find £3,000 for the deposit and prices start from £29,995.

Car prices soar since Brexit, but you can bag these great dealsLuxury cars, discount: Mercedes-Benz S350d SE L 9G-Tronic

Discount: 19.2%

You could wander into a Mercedes-Benz showroom and drop £70,425 on an S350d in SE L trim. Alternatively, you could negotiate a 19.2% discount. You can spend the savings on a few tanks of diesel.

Luxury cars, finance: Mercedes-Benz S-Class

Finance: 3yr 0% APR PCP with an £8,443 deposit

Sticking with the S-Class, What Car? believes the three-year 0% PCP deal on the big Merc’ is the best finance deal in the luxury car segment. Just be sure you have £8,443 for the deposit.

Car prices soar since Brexit, but you can bag these great dealsEstate cars, discount: BMW 535d Luxury Touring Step Auto

Discount: 22.6%

The BMW 5-Series Touring is a big estate car, with 560 litres of space with the seats in place, or 1,670 litres with the seats folded down. The discount is generous, too, with 22.6% available on the 535d Luxury model.

Estate cars, finance: Skoda Octavia Estate

Finance: 3yr 0% APR PCP with a £2,000 deposit

The Skoda Octavia Estate is one of our favourite cars at any price, and with a facelifted version imminent, now’s the time to bag a great deal on the outgoing model. A three-year PCP deal is available with a £2,000 deposit.

Car prices soar since Brexit, but you can bag these great dealsMPVs, discount: Citroen C3 Picasso

Discount: 30.0%

MPVs might be as popular as Donald Trump at a Clinton family get-together, but the Citroen C3 Picasso is one of the best of a seemingly dying breed. Prices start from £16,975, but you can expect a 30% discount across the range.

MPVs, finance: Ford S-Max Vignale

Finance: 3yr 0.9% APR PCP with a £1,000 deposit

Vignale is Ford’s posh trim level – a Ghia for a new generation, if you like. Order a Ford S-Max Vignale and you can enjoy a three-year 0.9% PCP deal for a £1,000 deposit.

Car prices soar since Brexit, but you can bag these great dealsSmall SUVs, discount: Renault Captur 0.9 TCe 90 Expression+

Discount: 11.8%

“We knew average prices were going up, but rather than a gradual rise, our research has shown that there has been a perfect storm of elements that has conspired to create a big bang in price hikes,” explained What Car? editor Steve Huntingford. But don’t worry, a 11% discount is available on the Renault Captur.

Small SUVs, finance: Skoda Yeti SE and SE L

Finance: 3yr 0% APR PCP with a £1,500 deposit

The Skoda Yeti might be getting long in the tooth, but it remains one of our favourite small SUVs. A three-year 0% PCP deal on the SE and SE L models is a tempting proposition.

Car prices soar since Brexit, but you can bag these great dealsLarge SUVs, discount: BMW X5 xDrive50i M Sport Step Auto

Discount: 12.7%

“Our new car buying marketplace saves you the hassle of shopping around, letting you configure a car to your desired spec and then directly compare prices from dealers in your area,” said Steve Huntingford. Why spend £67,505 on a BMW X5 xDrive50i M Sport when you can save 12.7%?

Large SUVs, finance: Jeep Cherokee Limited

Finance: 3yr 0% APR PCP with a £2,750 deposit

Right now, the three-year 0% PCP deal available on the Jeep Cherokee Limited is the best you can hope for in the large SUV segment. For more deals, consult the What Car? Target Price, which is the most you should have to pay for a particular model.

Car prices soar since Brexit, but you can bag these great dealsCoupes, discount: BMW 650i Sport Gran Coupe Auto

Discount: 22.1%

The BMW 6 Series features heavily in the What Car? data, appearing in five of the final six deals to be featured. First up, the 650i Sport Gran Coupe, of which you can expect a 22.1% discount.

Coupes, finance: BMW 6 Series SE and M Sport Coupe

Finance: 3yr 0% APR PCP with a 0% deposit

Meanwhile, the 6 Series SE and M Sport Coupe are available with a three-year 0% PCP deal and a 0% deposit. That should make the £60k+ price tag a little easier to stomach.

Car prices soar since Brexit, but you can bag these great dealsConvertibles, discount: BMW 650i Sport Convertible Auto

Discount: 23.6%

A BMW 650i Sport Convertible has an on-the-road list price of £75,800, but nobody pays that. Not when there’s a massive 23.6% discount available.

Convertibles, finance: BMW 6 Series SE and M Sport Convertible

Finance: 3yr 0% APR PCP with a 0% deposit

The BMW 6 Series Convertible also features as the What Car? best buy in the convertible segment. It’s that same three-year 0% PCP deal once again.

Car prices soar since Brexit, but you can bag these great dealsPerformance cars, discount: Mercedes-AMG CLS 63 S Tip Auto

Discount: 18.6%

Breaking from the BMW 6 Series for a moment, you can expect an 18.6% discount on the Mercedes-AMG CLS 63 S.

Performance cars, finance: BMW M6

Finance: 3yr 0% APR PCP with a 0% deposit

Finally, the gloriously good looking but eye-wateringly expensive BMW M6. The list price of £93,265 is on the large side, but a three-year 0% PCP deal and 0% deposit should soften the blow.

January sales: the best new car deals available NOW

January sales: the best new car deals available NOW

January sales: the best new car deals available NOW

New year, new you… or new car, perhaps? If you’ve not overdone the spending this Christmas, January is a great time to buy a new vehicle, with many manufacturers offering extremely tempting deals across their ranges. We’ve picked out some of the best offers.

Ford: interest free finance

Britain’s favourite car manufacturer is offering 0% APR representative finance on a number of its cars, including the new Edge SUV and desirable ST-Line models. That’s through its Ford Options PCP scheme, meaning you can pick up a new Ka+ from £109 per month over two years. That’s following a deposit of £3,670.05 and with an optional final payment of £4,754.

Kia: free servicing on SUVs

With the weather getting colder, a shiny new SUV makes for a tempting purchase this January. Kia is offering free servicing on all its SUVs ordered in January, including the Soul, Niro, Sportage and Sorento. Buyers will get Kia’s Care-3 package, made up of three free services, for no cost – saving up to £349.

Other Kia offers including a free upgrade to the Sportswagon estate if you buy an Optima (saving £800), while Caravan Club members can get up to £1,000 of accessories free of charge with the purchase of a new Sorento SUV. There are also 0% interest PCP deals available on the Cee’d and Picanto.

SEAT: £1,000 off

SEAT: £1,000 off

Fill in a form on SEAT’s website and you’ll be sent a voucher for £1,000 off any new SEAT model – including the new Ateca SUV, as part of the firm’s Beautifully Created Winter Drive event. Be quick, as the offer expires on 23 January, but it can be used on top of other offers. These include free insurance on selected Ibiza models, and a £2,000 deposit contribution on a five-door Leon SE Dynamic.

Vauxhall: up to 22% off selected models

Vauxhall is running a bonus tag event until January 16th, with 22% off the list price of five-door Corsa Energy 1.4 – saving you up to £3,300. Other stand-out deals include 21% (£3,445) off a Corsa Limited Edition, 16% (£2,405) off an Adam Energised and 21% (£4,510) off a Mokka X Active.

Fiat: 0% interest finance

Italian carmaker Fiat often offers tempting deals across its range – with the popular 500 city car currently available with 0% interest finance. The firm will also contribute £1,000 towards your deposit, meaning you could drive away in a 500 Lounge 1.2 for £99 a month following a deposit of £3,998. That’s over two years, with an optional final payment of £5,525 if you want to keep the car. Mileage is limited to 6,000 a year, so be careful if you cover high miles. You could be hit with a fee of 6p per mile if you exceed this figure.

Lotus: Pay half now, half in two years

Lotus: Pay half now, half in two years

British sports car manufacturer Lotus has a very tempting offer on a new Elise Sport: pay half now, and the rest in two years. Very simply, that means you’ll pay a ‘deposit’ of £15,425, while the remaining £15,425 is due after 24 months. You’ll pay nothing in interest.

Volkswagen: £1,400 deposit contribution on Polo and free insurance

The Volkswagen Polo is showing its age alongside supermini rivals, with a new model expected later this year. But that means there are good deals available on the outgoing car – including a £1,400 deposit contribution when bought on PCP, along with a year’s free insurance. There are Ts and Cs, of course: the insurance isn’t available to 17-year-olds, and those under 25 will have to use a telematics black box.

Skoda: 0% finance and £1,500 minimum part exchange

The Skoda brand is synonymous with excellent value, and there’s a wide range of offers available at your local Skoda dealer this January. They include 0% APR PCP deals on models including the Citigo, Octavia and Yeti, along with deposit contributions of up to £2,000. On selected models, Skoda will also give you a minimum of £1,500 for your part-exchange.

Toyota: 0% finance

Toyota: 0% finance

Yes, it’s 0% interest finance overload this January, but with an increasing amount of us buying cars through PCP schemes, that’s no bad thing. Toyota is offering 0% APR on its Aygo, Yaris, Auris and Verso models, meaning you can drive a new Toyota for as little as £99 a month. That’s over four years, for an Aygo X-press, following a deposit of £3,128.50. Increase your monthly payments to £159 and the deposit drops to £668.50.

Honda: 0% finance

As part of its winter event, Honda is offering interest-free finance across its range, including Jazz, Civic and CR-V models. Buy a practical Jazz 1.3 EX for £185 a month over two years, following a deposit of £3,685. After 24 months, hand the car back or pay an optional £8,519 to keep hold of it. Mileage is capped at a not-unreasonable 10,000 miles a year. Hurry, though – the deal expires at the end of January.

Renault: £500 off when you take a test drive

If you hurry, you can save £500 off selected Renault models if you take a test drive and place an order this week. The offer is available on Clio, Captur and Kadjar models until 9 January as long as they’re registered by 31 March 2017. The company is also offering interest-free finance over two years on selected models, meaning you can drive a Clio for £169 a month following a £2,571 deposit.

Nissan: 0% finance

Nissan: 0% finance

Despite being one of the hottest new superminis of 2017, £269 a month for the new Nissan Micra isn’t headline-grabbing. What is more tempting, however, is £119 a month finance with 0% APR interest on a Pulsar DIG-T Acenta. It’s no Ford Focus or Volkswagen Golf, but with a £1,000 Nissan deposit contribution leaving you with £4,175.80 to pay upfront, followed by 36 monthly payments of £119, the Pulsar does represent good value.

Suzuki: free insurance

The new Suzuki Ignis was one of our favourite cars we drove in 2016, and it’s available to order now with a year’s free insurance when you buy it through the manufacturer’s PCP finance scheme. The offer excludes the entry-level SZ3, and is available to 21- to 79-year-olds only.

MG: 0% finance

MG might have given up the pretence of ‘assembling’ cars in the UK, but they’re still worth a look if value is high on your agenda. Both its models – the 3 supermini and GS crossover – are available with 0% interest finance. You can buy an MG 3 3Time for £111.99 a month over 60 months, following a deposit of £1,679.80. After five years, you’ll own the car outright, having paid a total of £8,399.

Buy a used Nissan Leaf for £175 a month - with a tiny deposit

Buy a used Nissan Leaf for £175 a month – with a tiny deposit

Buy a used Nissan Leaf for £175 a month - with a tiny deposit

More than 15,000 Nissan Leafs have been registered in the UK this year – meaning it holds onto its crown as the country’s most popular electric car.

But the firm says, after four years on sale, the number of used examples on the market are increasing – making it more accessible than previously.

As such, Nissan is launching a £1,000 dealer deposit contribution towards a PCP deal on used examples of the Leaf – meaning you could drive one for £175 a month, following a deposit of just £175.

Available on the 24kWh Acenta model, buyers get a 12 month warranty and free home charge unit, while interest works out at 3.9% APR.

You’ll own the battery outright – although new examples are available with the battery leased from £70 a month – and Nissan will replace any part of the battery causing capacity loss below nine bars (out of 12), within the three-year battery warranty period.

A search on Auto Trader, meanwhile, reveals you can buy a three-year-old Leaf with 61,000 miles on the clock for £5,599 – and the dealer selling it is offering 0% finance.

If you’d prefer a new one, you can buy a new Acenta 24kWh for £249 a month over three years. This follows a deposit of around £2,500, while interest works out at 5.99% APR.

Nissan Leaf

Nissan sells 15,000th Leaf EV in UK, gives £500 off

Nissan LeafNissan is marking the sale of 15,000 Leaf electric cars in the UK with a £500 bonus saving for customers in September.

The deal is on top of Nissan’s finance deal, which offers a 24kWh Leaf Acenta for £249 a month on a three-year PCP. Nissan contributes a hefty £5,000 towards the deposit and the APR is a reasonable 5.9%.

If that’s not enough, Nissan includes a free home charging kit as well, worth another £390. No wonder it’s clocked up 15,000 sales…

The buyer of the 15,000th Leaf was Jenny Craik, who swapped her regular-fuel 14-plate Ford Fiesta for a Leaf EV. Her husband already drives a plug-in hybrid and she says his positive words, combined with the environmental and running-cost savings, encouraged her to switch.

Nissan hit 15,000 UK Leaf sales just 12 months after reaching the 10,000 mark. The firm says demand for the Leaf in the UK is higher now than at any point in the three years since its launch.

The news of the 15,000th UK Leaf comes as Renault reveals it has now sold 100,000 electric cars, and the Renault-Nissan Alliance announces its 350,000th sale.

However, the Leaf now won’t now be getting an impressive-sounding new rival from Vauxhall here in the UK. Vauxhall’s parent firm, General Motors, has regrettably decided not to engineer the new Ampera-e – which boasts an official NEDC electric driving range of more than 250 miles – for right-hand drive.

Buyers now change their cars as often as they upgrade their phone

Buyers now change their cars as often as they upgrade their phone

Buyers now change their cars as often as they upgrade their phone

Most people change their mobile phone once every two years – but many car buyers are looking to upgrade their wheels within as little as 18 months, according to automotive experts CAP.

Finance options such as personal contract purchase (PCP) and personal contract hire (PCH) have rocketed in popularity in recent years, allowing motorists to ‘buy’ a new vehicle and swap it for a new one a few years down the line – as you would a mobile phone.

CAP HPI’s retail and consumer specialist, Philip Nothard, said: “What we are seeing is the ‘iphonification’ of the car industry as consumers increasingly pay to drive rather than pay to own their vehicles. It’s the same model as the mobile phone industry where people are comfortable paying a monthly fee – only they are now doing this with their vehicles as well as their mobiles.”

Although PCP deals generally last for a three-year period, buyers are entitled to ‘voluntarily terminate’ the contract after 50% has been paid off.

Dealers often encourage car buyers to do this in a bid to persuade them to upgrade to a new car in a shorter period of time – but an investigation revealed today by Auto Express magazine has found that this could harm their credit rating.

Although dealers themselves are happy to cooperate with a voluntary termination if their customer buys another car from them, the finance company could be losing out – meaning a red flag might be placed on their credit rating.

Nothard added: “Not so long ago it was fairly common for motorists to have their cars for a minimum of five years or longer but that has now changed dramatically and dropped to just two years for millions of motorists. After buying a house, the car was usually the biggest outlay for most consumers but now they are far more likely to change their car more often than their mattress.”

Experts advise that mattresses should be changed every seven or eight years to ensure a good and healthy night’s sleep although in reality many consumers don’t stick to this guideline. When it comes to cars, however, fewer of us are holding onto our motors for such a long period of time.

What is PCP/PCH car finance?

CAP estimates around 80% of new car sales are on finance – with most of these being PCP or PCH schemes.

When you see dealers advertising tempting deals, such as a new Renault Clio for £159 a month, it’s usually a PCP on offer.

Using the Clio as an example, you’ll pay a deposit of £947 followed by 36 payments of £159 over three years. These payments essentially cover the depreciation – the dealer will have estimated how much the car’s worth after three years.

If, after the three-year period, you want to upgrade, simply hand the car back and pay nothing else. Or, if you want to buy the car outright, stump up the value of the three-year old Clio (£4,632).

These payments can often be tweaked to suit you. If, for example, you can’t afford a large deposit, many dealers will compensate by offering larger monthly payments.

If you have a car you already own outright, most dealers will take this as part-exchange – and it could act as the entire deposit on a PCP plan.

PCH is very similar to PCP, but you don’t technically own the car. Although you’re responsible for paying insurance, you don’t usually pay road tax and there’s never the option to buy the car after the leasing period.

If you expect to change your car every few years, it’s usually best to consider both PCH and PCP – whichever’s best can depend on the deals the manufacturer is offering at that time.