FAQs

Who is eligible for Car Finance?

You could apply for Car Finance if you’re buying a new or used car from a selected dealership, are 18 years old or over, a resident in the UK, have a Bank of Scotland current account of 3 months or more, are registered for Internet Banking.

Are there any restrictions on which car I can buy?

We offer finance for new and used cars at the majority of UK dealerships. There are some restrictions relating to make/model, age and mileage of the car, and we can't finance commercial vehicles. After you enter the details for the car you want to buy, we’ll tell you if our finance is available for that car.

We do not finance commercial vehicles, motorcycles or leisure products such as caravans and motorhomes. Other limitations based on the vehicle may apply.

Can I part-exchange my current car?

We don’t currently offer part exchange as part of our Car Finance however you could arrange a part exchange with the dealership, who can settle any existing finance on your vehicle, if applicable.

Can I use any car dealership?

We work with the majority of UK dealerships - you can search by your location or postcode to find out which dealers we currently work with, once logged on to Internet Banking.

How do Bank of Scotland pay for my car and how long will it take?

We transfer the finance amount to the dealership directly as soon as you've signed the legal documents online. It can take several hours for the money to be received. Payments made after 3.30pm will be with the dealership before 12pm the following day.

Do you offer Car Finance for motorbikes or vans?

Unfortunately not, our finance is only available for cars.

Can I use your Car Finance to buy a car for business purposes?

Unfortunately not, you can only take Car Finance for personal, not business purposes.

If I finance a vehicle, am I able to register the car in another family member's name?

We do not allow the vehicle to be registered in another family member’s name. The person applying for finance should be the registered keeper of the vehicle, have a valid driving licence permitting them to use the vehicle and also be the main driver.

Can I transfer my agreement to someone else?

No, you cannot transfer an agreement to someone else.

Do I have to be on the voters/electoral roll to get approved for Car Finance?

Not necessarily, although this could affect your credit score, if you’re not.

Why do I need Internet Banking?

Bank of Scotland Car Finance is an online offer only. Once you've registered for Internet Banking (it’s easy to register and only takes a few minutes) you can use the personalised calculator to see what each Car Finance option could look like for you.

Register for Internet Banking

What paperwork will I need?

You will not need to provide any paperwork and details of your finance agreement will be sent to you by email. You should read all paperwork carefully and store it in a safe place. We’ll send you a welcome letter which confirms your monthly payments and direct debit details.

Is car insurance included as part of Car Finance?

Car insurance is not included as part of the finance we offer although it is available separately. Please note we need the car to be comprehensively insured.

Fees at the end of your agreement

Potential Fees at the end of your agreement

At the end of your agreement

Purchase fee - This is optional, but you must pay it if you want to become the owner of the Vehicle. It is included in the Final Repayment = £10

Excess mileage fees -

Applicable on PCP only if you choose to return the vehicle at the end of your agreement instead of paying the final lump sum

If your engine size is up to 1.6 litres = 8.4p per mile

If your engine size is more than 1.6 litres up to 2.0 litres = 12.6p per mile

If your engine size is more than 2.0 litres = 16.8p per mile

If your car is electric = 9.6p per mile

(All excess mileage fees shown are including VAT at 20%)

I'm not a Bank of Scotland customer - can I apply?

No - our Car Finance offer is for existing customers who have held a Bank of Scotland current account for more than 3 months, are UK residents and aged 18 and over.

How does the application work?

Applying for Car Finance is straightforward:

• First you can use our calculator to compare options available to you. This calculator is personalised and lets you know what you’re able to borrow
• The next step is to enter the details or the car and dealership you’re using. You can use the ‘Find Dealer’ section to check if a dealership is eligible before completing the application
• We will then complete an affordability assessment and subject to your application being accepted, we’ll keep the offer for you for up to 90 days
• Finally you need to enter the bank details of the dealership you’re using to complete the finance agreement. We’ll then pay the dealership direct.

What details do I need before I apply?

Once you’ve found the car you want to buy, we’ll need some further details:

• Dealer’s name, postcode and bank account details
• The registration number
• Current mileage
• How many miles you expect to drive each year
• The price
• The deposit.

If it’s a new car we’ll also need:

• The delivery date of your car
• The full vehicle details if you don’t know the registration.

We’ll also ask details of your finances such as your monthly income, existing finance commitments, including Car Finance.

Can I apply in branch?

Car Finance is an online offer only so you can't apply in branch.

If you do have any questions you can call us on +44 (0)333 202 7969 and we’ll be happy to help. Please note, you won’t be able to apply over the phone.

How many applications can I make?

You can make as many applications online as you like, without any credit searches because you’re already our personal current account customer and we’ll keep the offer for you, up to 90 days. However, you can only have one application saved at a time.

Can I apply using my joint account?

Providing you’re eligible you can apply using your joint account but the application will be registered against the customer that is currently signed in. This means the Car Finance contract will be in one name only and can only be administered by that customer.

• When completing the application the answers you give should only reflect your individual circumstances
• Income should be entered as your personal income not the full household income
• Outgoings should be entered as your contribution to those costs.

What if I want to change my car before the end of the term?

You’ll need to request an early settlement figure from us, which you can do online, and settle your current contract before you change the car. You’ll also have the option to voluntarily terminate your contract. Our customer service team will be able to give you details of the early settlement balance or more information about voluntary termination, and the steps you’d need to take.

You also have the option to voluntary terminate your agreement. You will need to return the car and half of the total amount payable as detailed on your agreement documentation. If you have already paid at least this amount plus any overdue repayments and have taken reasonable care of the car, you will not have to pay any more.

What if I decide I want to keep the car?

If you decide to keep the car you will need to pay the final payment (Fixed HP Plan) or the final lump sum payment (Flex PCP). It is important that Flex PCP customers prepare for how they will make the final lump sum payment.

What happens if I decide to give the car back at the end of my Flex (PCP) Car Finance term and how do I return it?

We’ll contact you 90 days before the end of your finance agreement to outline the options you have. If you decide to return the car to us, you’ll need to call our customer services team on +44 (0)333 202 7946.

We can either:

• Arrange to pick the car up from you free of charge providing the car is driveable and road legal
• Or, if you'd prefer you can return it to one of the authorised venues across the UK.

If the car cannot be driven and requires a tow truck a charge may apply.

Once the car has been collected or returned, we’ll check the mileage and that it’s in good condition. Providing that you have not exceeded the maximum agreed mileage and the vehicle is in good condition, we’ll write to you confirming that the agreement has ended and your Car Finance account is closed. If the vehicle has exceeded the maximum agreed mileage a charge per excess mile will apply.

Will Bank of Scotland perform a credit search when I apply?

When you apply for Bank of Scotland Car Finance, we don’t need to do any additional credit searches, because we already know you. This means that you can browse your options and apply for Car Finance with no impact on your credit report.

If you take out a Car Finance plan, this will be detailed on your credit report.

Can I transfer my existing Car Finance arrangements or do you offer finance consolidation?

Yes, we now offer re-finance on certain credit agreements taken out with other providers. Please contact us on 0333 202 796* to discuss your options.

We don’t offer consolidation of finance, for example paying off a loan or credit card that you’ve bought a car with. If you refinance existing debts, you may pay a higher rate of interest or make repayments over a longer term. This means that you may pay more interest overall.

To see if you’re eligible to apply for re-finance, see ‘Who is eligible for Car Finance?’ section.

What is the lump sum on the Flex (PCP) option?

The lump-sum is a one-off optional payment due at the end of your (PCP) finance term, if you decide to keep the car.

This is normally referred to as the Guaranteed Future Value (GFV) and is an estimated value of how much the car will be worth at the end of a finance agreement (based on your expected mileage and agreement term). The GFV is only applicable if you intend to hand the car back at the end of the agreement as part of the goods return option.

There’s no lump sum payment on the Fixed (HP) finance option, which is why monthly payments are usually higher than with the Flex (PCP) option.

What does APR mean?

APR stands for Annual Percentage Rate and is the amount of interest on your total borrowed amount that you'll pay annually (averaged over the full term of the loan).

APR’s are typically used when comparing finance options to understand which would be the cheapest option overall.

What's the difference between Car Finance and an unsecured personal loan?

Extra protection

If you use Car Finance instead of an unsecured personal loan to buy your car you’ll benefit from extra consumer protection. The consumer rights act applies which means the finance company has responsibility for the quality of the goods and to resolve any issues with the dealership if they are not of the required standard.

Voluntary termination rights

Under the Consumer Credit Act 1974 you have a right to end any regulated Hire.

Purchase (HP) or Personal Contract Purchase (PCP) agreement at any time before the final repayment under your agreement, becomes due. This is known as voluntary termination and is detailed in the ‘Termination: Your Rights’ section on your credit agreement.

You also have the option to voluntary terminate your agreement. You will need to return the car and half of the total amount payable as detailed on your agreement documentation. If you have already paid at least this amount plus any overdue repayments and have taken reasonable care of the car, you will not have to pay any more.

Secured lending

Car Finance lenders use the car as security against the finance taken out, so if payments aren’t kept up, the car can be repossessed.

For unsecured personal loans the lender doesn’t secure the finance against an asset (E.g. a car or a home).

Car ownership

Car Finance (PCP or HP options)

Don’t own car until final payment

Unsecured personal loan

Own the car as soon as you purchase

Loan Purpose

Car Finance (PCP or HP options)

Can only use to purchase car

Unsecured personal loan

Could use for other purposes as well as car purchase

Deposit required to take finance out

Car Finance (PCP or HP options)

Typically yes

Unsecured personal loan

No

Extra protection

Car Finance (PCP or HP options)

Yes – protection under the consumer rights act if something goes wrong and the right to terminate your regulated agreement under the Consumer Credit Act 1974

Unsecured personal loan

No

What should I do with the dealership's invoice?

You can store your invoice with the rest of the car's documentation, as the invoice is for your record only. You may need this in future when title is transferred to you as proof of purchase.

How do I work out my deposit?

Your deposit is the amount of money you have available to pay the dealership upfront and could include savings and/ or the value of a current vehicle. For example:

1. Mr Jones is coming to the end of a 3 year existing Car Finance agreement, which is a PCP deal and wants to buy a different car. He has his eye on a car being sold at £13,200. His local dealership gives him a valuation of his current vehicle of £6,000. This is £500 higher than the amount required to settle the outstanding finance on his current car (£5,500) so he decides to use this as equity for his new car rather than return his current car to his current lender under the terms of his PCP deal. He will therefore pay the £5,500 to his current PCP lender and have £500 to use as a deposit on his new car.
   Mr Jones also has £1,000 cash savings. Using the £500 equity in his current car, plus his savings he has a deposit of £1,500 to pay directly to the dealership.
   When applying for Bank of Scotland Car Finance Plus, Mr Jones inputs the price of the car as £13,200, his deposit as £1,500 and therefore his borrowing amount as £11,700.
2. Ms Singh owns her car outright but fancies a change. She has seen a car for sale at £8,000. The dealership offers her £1,750 for her current car which she accepts. Adding her cash savings of £250 to this gives her a deposit of £2,000. When applying for Bank of Scotland Car Finance Plus, Ms Singh inputs the price of the car as £8,000, her deposit as £2,000 and therefore her borrowing amount as £6,000.