What is outstanding finance on a car?
Outstanding finance is the amount you still owe on a vehicle finance agreement.
Your car may be on a finance agreement, such as PCP or HP. If so, you'll have outstanding finance until the agreement is settled or reaches its agreed end. Each monthly payment reduces the balance, so the amount you owe goes down over time.
If you want to end the agreement early, your finance provider can give you a settlement figure. This is the exact amount needed to clear the agreement on a given date.
Having outstanding finance does not necessarily stop you from changing your car. You just need to settle or handle the existing agreement properly as part of the process.
How do I find out how much finance I owe?
To find out how much you still owe, ask your finance provider for a current settlement figure.
This is the amount needed to clear the agreement on a specific date. It may differ from your remaining payments once interest and charges are factored in.
Our Early Settlement Calculator can give you a rough idea of what you still owe. You can then compare that figure with your car's current value to see whether you're in a good position to change it.
Use the calculator as a guide, but get a confirmed settlement figure from your lender before you decide anything.
What can I do if my car has outstanding finance?
You have several options if you still owe money on your agreement:
- Continue the agreement: Keep making your scheduled payments if you're happy to keep the car.
- Settle the finance early: Request a settlement figure from your lender and clear the agreement.
- Sell the car: This is possible, but the finance must be settled as part of the sale.
- Part exchange the car: Compare your settlement figure with your car's current value to see where you stand.
Find out what your car is worth with our free part-exchange valuation.
Positive vs. negative equity
If your car is worth more than you owe:
The difference (known as positive equity) can go towards your next car.
Car value = £12,000 | Settlement figure = £9,000 | Position = £3,000 in positive equity
If your car is worth less than the settlement figure:
The difference is known as negative equity. You will need to account for this shortfall if you want to change the car. Depending on the new finance agreement and the lender's assessment, there may be different ways to deal with it.
Car value = £9,000 | Settlement figure = £12,000 | Position = £3,000 in negative equity
Learn more about negative equity and available routes on our dedicated page.
Can I sell a car with outstanding finance?
You can sell a financed car, but the outstanding agreement must be settled properly as part of the sale.
If your car is on PCP or HP, the finance provider remains the legal owner during the agreement. This means you generally need to settle the finance. Or you can agree on the correct process with the lender before selling the car privately.
If you're part-exchanging your car, the dealership can usually pay off your finance for you as part of the deal.
Can I trade in a car with outstanding finance?
Yes, and it's a common thing to do. It's usually straightforward when your car is worth more than you owe on it.
Start by getting a valuation for your car, then ask your lender for a settlement figure. Compare the two to see where you stand.
Does outstanding finance work differently with PCP and HP?
The basics are the same, but PCP and HP are structured differently, which affects what you're paying towards and what happens at the end.
Personal Contract Purchase (PCP) - Your monthly payments repay part of the amount financed. An optional final payment remains if you want to own the car at the end.
Read our PCP guide for the full agreement structure and end-of-term options.
Hire Purchase (HP) - Your monthly payments repay the financed amount over the length of the agreement. Ownership passes once the required payments and any applicable final fee are completed.
Read our HP guide for the full agreement structure and route to ownership.
You can settle both finance agreements early. Ask your finance provider for a current settlement figure. You can potentially change your car early too. Compare your current settlement figure with the car's value, and arrange for the existing agreement to be settled correctly.
Outstanding Car Finance FAQs
Representative Example
This represents an average of the deals that our customers receive on other vehicles
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