What is the average car payment in the UK?

There is no single official figure for the average UK car finance payment, and quoted averages vary widely depending on whether they cover new or used cars, PCP or HP. As a worked guide at 6.9% APR with a 10% deposit, a £15,000 car costs about £214 a month on PCP or £323 on HP over four years; a £25,000 car about £356 on PCP or £538 on HP.

What is a normal car payment for my salary?

A common UK guide is 10–15% of take-home pay. On a £30,000 salary (about £2,090 a month take-home in 2026/27) that is roughly £210–£315 a month. On £40,000 (about £2,690) it is roughly £270–£405.

Why are PCP payments lower than HP?

PCP defers part of the car’s value to an optional final payment (the balloon or guaranteed future value). You only repay the difference, plus interest on the full amount, during the term. HP repays the whole amount, so monthly payments are higher but you own the car at the end with nothing more to pay.

Is £300 a month a lot for a car?

It depends on your income and other costs. £300 is about 14% of take-home on a £30,000 salary and about 11% on £40,000. At 6.9% APR over 48 months, £300 a month repays about £12,600 of finance on HP.

How can I lower my monthly car payment?

Choose a cheaper or older car, put down a bigger deposit, find a lower APR, or extend the term. A longer term lowers the payment but increases total interest. PCP lowers the payment too, but leaves a balloon at the end.

Average car payment UK: what is a typical monthly cost?

Search for the “average car payment” and you will find very different numbers, because published averages mix new and used cars, PCP and HP, and different deposits. Rather than quote a single figure that may not fit you, this guide shows what monthly payments typically look like at common car prices, what is a sensible payment for your salary, and what pushes the number up or down. Try your own figures in the calculator.

Reviewed by: Oliver Burton, Editor · Last updated: 09 October 2026

Monthly payment

Amount financed: £13,000
Estimated monthly payment: £311
Total interest: £1,914
Total repayable: £14,914

Disclaimer

This calculator is for estimation only. It is not financial advice and does not represent a lending decision. Your actual affordability and car finance options in the UK depend on your circumstances and the lender's criteria.

Typical monthly payments by car price

Car price	PCP, 48 months	HP, 48 months	HP, 60 months
£10,000	£142	£215	£178
£15,000	£214	£323	£267
£20,000	£285	£430	£356
£25,000	£356	£538	£444
£30,000	£427	£645	£533
£40,000	£570	£860	£711

Worked examples: 10% deposit, 6.9% APR. PCP assumes a final balloon of 40% of the price (real balloons vary by car, mileage and term). Excludes fees.

PCP looks much cheaper each month, but on a £20,000 car you would still owe an £8,000 balloon at the end if you wanted to keep it. HP costs more monthly but leaves nothing to pay. See why PCP dominates UK car finance and compare deals in the PCP vs HP calculator.

What is a normal car payment for your salary?

Salary	Take-home / month	10% of take-home	15% of take-home
£25,000	~£1,790	£179	£269
£30,000	~£2,090	£209	£314
£40,000	~£2,690	£269	£404
£50,000	~£3,290	£329	£494
£60,000	~£3,780	£378	£567

2026/27 income tax and 8% employee NI, standard tax code, England/Wales/NI, no pension or student loan.

Matching the two tables: on £30,000, a 15% budget of about £314 covers a car of around £22,000 on PCP (leaving a balloon of about £8,800), about a £14,500 car on 48-month HP, or about £17,500 on 60-month HP, all with a 10% deposit. For your full budget, use the car affordability calculator or the salary guide.

What pushes your payment up or down

Price and deposit: every £1,000 less borrowed cuts about £24 a month off a 48-month HP deal at 6.9%.
APR: £15,000 borrowed over 48 months costs about £358 a month at 6.9% but about £417 at 14.9%.
Term: longer terms lower the payment but increase the total interest.
Balloon (PCP): a higher guaranteed future value means lower payments but a bigger final bill.
Mileage (PCP and leasing): higher annual mileage usually lowers the balloon, so payments rise.

Don’t forget the rest of the monthly cost

The finance payment is only part of what a car costs each month. Add insurance, fuel or charging, vehicle tax (£200 a year standard rate for most cars from 1 April 2026, about £17 a month), servicing and MOT. If you are weighing up electric, see electric car running costs. If leasing appeals, see leasing affordability.

Frequently asked questions

What is the average car payment in the UK?: There is no single official figure for the average UK car finance payment, and quoted averages vary widely depending on whether they cover new or used cars, PCP or HP. As a worked guide at 6.9% APR with a 10% deposit, a £15,000 car costs about £214 a month on PCP or £323 on HP over four years; a £25,000 car about £356 on PCP or £538 on HP.
What is a normal car payment for my salary?: A common UK guide is 10–15% of take-home pay. On a £30,000 salary (about £2,090 a month take-home in 2026/27) that is roughly £210–£315 a month. On £40,000 (about £2,690) it is roughly £270–£405.
Why are PCP payments lower than HP?: PCP defers part of the car’s value to an optional final payment (the balloon or guaranteed future value). You only repay the difference, plus interest on the full amount, during the term. HP repays the whole amount, so monthly payments are higher but you own the car at the end with nothing more to pay.
Is £300 a month a lot for a car?: It depends on your income and other costs. £300 is about 14% of take-home on a £30,000 salary and about 11% on £40,000. At 6.9% APR over 48 months, £300 a month repays about £12,600 of finance on HP.
How can I lower my monthly car payment?: Choose a cheaper or older car, put down a bigger deposit, find a lower APR, or extend the term. A longer term lowers the payment but increases total interest. PCP lowers the payment too, but leaves a balloon at the end.

Sources & notes

Our calculators and guides draw on publicly available UK guidance. We review content periodically but do not guarantee that external sources remain unchanged. See our about page for how we use these tools.

MoneyHelper – How to find the right way to buy a car
General guidance on budgeting and car finance options in the UK.
MoneyHelper – Work out your budget
Household budgeting principles used alongside affordability rules of thumb.
FCA – Consumer credit and your rights
Regulatory context for regulated car finance agreements.
FCA Handbook – CONC 5.2A (creditworthiness and affordability)
How FCA-regulated lenders must assess affordability (illustrative reference).
Black Horse – Car finance (sample lender information)
Example of how a major UK motor-finance provider describes its products.
Santander – Car finance (sample lender information)
Example lender product information; rates and criteria vary by provider.

Compliance notes

Car Affordability UK is not authorised or regulated by the Financial Conduct Authority (FCA). We do not provide regulated financial advice, credit broking or lending.
Calculator outputs are illustrative estimates based on the inputs you provide and published third-party guidance. They are not quotes, offers of credit or lending decisions.
FCA-regulated lenders apply their own affordability assessments, which may differ from the percentage rules of thumb used on this site. Always check formal terms before signing any agreement.
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