Having a deposit always puts you in a stronger position. The larger the deposit you have, the better it gets.

First of all, remember your deposit need not be in cash - if you are buying your car through a dealer and have a car to use as part-exchange. This means the dealer will take your old car off you and reduce the price of the new car by the value of the old one. So, as an example:

Your new car is £10,000. The dealer values your old car at £2,000. That £2,000 is used as the deposit on your new car so you only have to borrow the balance of £8,000. Of course the value of your old car is a matter for negotiation! See buying and selling cars for advice on how to negotiate with confidence.

If you have a reasonable deposit, we recommend either hire purchase or a personal loan. Because of the strength of your position, most other methods of borrowing will involve costs you really don’t need to incur.