Car loans

Driving down the cost of
your car loan

On loans between £7,500 and £15,000 over 2 to 5 years

Car loans

Buying a car is one of the most important purchases you are likely to make, therefore it’s well worth checking the AA's Car Buyers Guide which offers reviews and advice for choosing the right car for you. You can also visit AA Cars where you can choose from 1000’s of vehicles. All cars come with a free car history check so that you can buy with confidence. Once you’ve chosen your perfect car a low rate car loan from the AA could help get you on the road.

An AA Personal Loan could offer you

  • a great low rate of 4.7% APR representative
  • fixed monthly repayments for the duration of the loan
  • repayments spread over 2 to 5 years
  • no arrangement fee
  • 6 months free Home Emergency Response*

Loan Calculator

Please enter an amount to borrow between £3,000 and £25,000 Term needs to be 24 months or more

By applying for this loan Creation Consumer Finance could offer you an alternative loan should you be unsuccessful for an AA Loan. There will be no additional checks on your credit rating as a result of this offer.

If you need help with your application or want to speak to someone about AA Loans please call 0800 096 8485

Other loan amounts

Our loan amounts range from £3,000 to £25,000. Use our loans calculator to find out more

Lending criteria

Before applying for a loan, please make sure the below are true:

  • you are aged between 25 and 70 at date of application
  • you have a minimum income of £12,000 (gross) per annum
  • you have a bank/building society current account from which you can pay direct debits
  • you do not have a history of adverse credit, ie County Court Judgments (CCJs) or bankruptcy
  • you have been a permanent UK resident for at least 3 years

Buy a used car from a name you can trust

Buy a used car

APR stands for annual percentage rate. This is the total charge for the loan including fees and interest expressed as a percentage, which allows you to compare across the market.

* Home Emergency Response (HER) provides cover against a range of common emergency situations including water leaks, electricity failure, being locked out of your home, and more. Excludes heating emergencies. For full terms and conditions see AA Home Emergency Response.

AA Loan customers will receive an email with instructions of how to activate their 6 months’ free Home Emergency Response within 28 days of their loan funds being received. You must activate your offer within 28 days of receiving the email. There is a 14 day claim-free period once activated.

Free six months' Home Emergency Response is only available to new AA Loan customers who have been accepted for a loan and had their loan funds paid to them. Customers with a current HER policy or those who have previously redeemed a free HER offer are not eligible for this offer. Offer may be withdrawn or changed at any time. Certain postcode restrictions apply. Limitations, exclusions, terms and conditions apply. You will not be charged for your free trial period although to activate your free cover you will need to provide payment details such as a debit or credit card. Eligible customers will be asked qualifying property questions before payment details are taken. Your Home Emergency Response Cover will be automatically renewed for 12 months when your free trial period ends using the payment details you provide. You will be sent a renewal letter four weeks before your free cover expires, so you’ll have plenty of time to change, upgrade or cancel your cover.

Home Emergency Response is underwritten by Acromas Insurance Company Limited, registered number 88716 (Gibraltar) and sold by Automobile Association Insurance Services Limited (AAIS). Automobile Association Insurance Services Limited is an insurance intermediary and is authorised and regulated by the Financial Conduct Authority, registration number 310562. You can check this on the Financial Services Register by visiting the FCA’s website www.fca.gov.uk or by contacting FCA on 0800 111 6768. Automobile Association Insurance Services Limited. Registered Office: Fanum House, Basing View, Basingstoke, Hampshire RG21 4EA England and Wales. Number 2414212.

AA Loans are provided by Creation Consumer Finance Limited. AA acts exclusively in relation to loans as a credit intermediary for Creation Consumer Finance Limited. Registered Office: 6th Floor, Royston House, 34 Upper Queen Street, Belfast BT1 6FD. Registered in Northern Ireland NI32565. Correspondence address: Chadwick House, Blenheim Court, Solihull B91 2AA.

Creation Consumer Finance Limited is authorised and regulated by the Financial Conduct Authority (FRN 311518). The status can be checked on the Financial Conduct Authority’s website or by calling 0800 111 6768

Buying a car

Buying a new car can often involve making important and expensive decisions. So we've put together this quick guide to help you decide what's right for you.

Finding the right car

You probably have a good idea of what sort of car you want to buy, however its well worth checking out the AA's Car Buyers Guide where you’ll find reviews and advice for choosing and purchasing the right car for you.

Search for a used car

If you decide that you want to purchase a second hand car then ensure you visit AA Cars where you can choose from 1000's of vehicles. All cars come with a free car history check so that you can buy with confidence and peace of mind.

Buy a used car from a name you can trust

Buy a used car

Car checks

If you choose to buy a second-hand car it is important to check to see if the car is roadworthy. It's also useful to know if the car has been involved in an accident or has outstanding finance. The AA provides two services to help:

  • AA Car Data Check – This is a comprehensive car history check that can tell if the car has any outstanding finance to pay on it, has been reported lost or stolen or has been involved in an accident and written off. It also provides you with mileage information and an estimate of the car's value.
  • AA Vehicle Inspection – This is a vehicle safety check and road test for peace of mind if you're not confident checking over a car yourself. Before you buy the car an engineer will perform up to 206 tests on the car and give a written report within 24 hours.

Financing your purchase

The most important decision when buying your new car is deciding how you are going to pay for it. You need to decide what your budget is, taking into account any likely trade-in value for your existing car, plus any cash savings you may have.

If you need to borrow money to pay for your new car it may seem more convenient to use the finance offered by the car dealer, but it is important to consider the following;

  • What is the APR you will be charged? Some dealership finance packages offer a much higher APR then you can get from a loan provider. This means you could be charged more for credit and end up paying more for the car then if you arranged the loan yourself.
  • Who owns the car? Some dealership finance packages are a hire purchase arrangement whereby the car remains the property of the company providing the finance until you have completed all payments.
  • Is the loan secured against the car? If so this could mean that the car is taken to settle any outstanding payments if you experience financial difficulties, and fail to keep up with the repayments.

An AA Car Loan, could be a cheaper way of borrowing money to pay for your new car. It also means that you will own the car outright once it is purchased and the loan is not secured against the car. Even better, once you have decided your budget and how much you can afford to pay each month, you could apply for the loan and, if accepted, have the money in your bank account ready to make your purchase. This makes you a 'cash buyer' and could help you get a better deal on the car.

Applicants must be between 25 and 70 at date of application and a UK resident (for at least 3 years) with a minimum gross income of £12,000.

Car insurance

Before you drive your new car, you'll obviously need to have car insurance in place. In fact it's a good idea to get insurance quotes before you decide on the car to buy so that you've got an idea of ongoing running costs. At the AA we'll search our panel of insurers to find you our best deal on your insurance.

Breakdown cover

However careful you are choosing and checking you're new car there's always a risk of a breakdown. As the UK's largest breakdown service, we rescue someone every 9 seconds*. We have a range of breakdown cover options to ensure you'll have help if you break down.

More information about you and your car

Follow these links to find more useful information about driving your car.
Car accessories
Wrong fuel in your car
Car batteries
Motoring costs
Breakdown advice
Service and repair advice
Fuels and environment
Seasonal driving advice


* According to analysis of 3.5 million AA breakdowns 2012

Loans explained

At the AA we offer unsecured loans, which are usually referred to as a 'personal loan'. An unsecured personal loan is an advance of money that is not secured by collateral such as your home.

A credit scoring will be undertaken to analyse whether you'll be accepted for an unsecured personal loan and will determine the amount of interest you will pay. The amount of interest you pay depends on your past history of meeting debts and repayments. Normally the better your credit rating, the lower your interest rate will be.

Typical unsecured personal loan amounts vary, but most will be between £1,000 and £25,000, and are repaid over one to five years. Please note, an AA Loan is available for between £3,000 and £25,000, over one to five years. You can use an unsecured personal loan to buy a car or pay for home improvements, for special events like weddings and holidays, or to consolidate your existing debt.

Some common loan terms are described in more detail below and can help you understand the application process.

Arrangement fee

Some lenders will charge a fee for arranging a loan, usually a one-off payment. An AA Loan has no arrangement fee.

CCJs

CCJ stands for County Court Judgement. These are usually issued if you have defaulted on payments of previous debt. Having a CCJ will usually affect your credit score and ability to borrow money in the future.

Credit reference agencies and your credit rating

When borrowing money you agree that the lender can check your credit rating. Your credit history will be held by a credit reference agency such as Experian or Equifax. You can access your credit history by visiting a credit reference agency's website.

Debt consolidation

If you have outstanding debt spread across a number of other loans, credit cards or store cards, you can combine these into one loan with one fixed payment. This is called 'debt consolidation'.

Fixed repayments

This is a regular fixed monthly repayment amount payable for the duration of your loan.

Fixed interest rate loans

These are fixed and can't be changed by the lender or the customer for the term agreed. Even if the Bank of England change the base rate, your loan rate will remain unchanged, giving you added peace of mind.

Loan

A loan is a sum of money which is borrowed and paid back, usually with interest over a period of time.

Member loan

This is a special rate loan to AA members. An AA member is defined as a holder of a current, valid breakdown policy purchased directly from the AA, or holder of a Member Rewards card through your insurance or other AA policy.

Payday loan

Payday loans are usually smaller amounts repaid over 30 days, and carry a higher interest rate. These loans typically cover your expenses until you receive your monthly salary. Amounts are typically between £100 and £1,000, and interest rates can be high. We don’t currently offer payday loans at the AA.

Representative APR

The Representative APR (Annual Percentage Rate) is the interest rate we charge to the majority of our customers who apply for a particular loan amount. We may offer a different APR based on your personal circumstances and the amount that you want to borrow.

Secured loans

Secured loans or homeowner loans are larger amounts – between £15,000 and £200,000. They are secured on your property – either a property you own or have a mortgage on. So if you can't meet repayments, you risk losing your property. We don’t currently offer secured loans at the AA.

Settlement figure

You may repay all or part of your loan early at any time. If you repay part of your loan early your monthly repayments will be reduced but the duration of the loan period will remain the same. If you settle the loan early in full, you may have to pay interest on the amount repaid or the amount of interest that may be payable depending on the length of your loan.

Term

This is the period of time over which the loan has been taken.

Frequently asked questions about loans

How much can I borrow?

Our loans are available from £3,000 to £25,000

How long can I borrow the money for?

You can repay your loan over 12 to 60 months (1 to 5 years). A one year term is only applicable for loans under £5,000.

What can I borrow the money for?

You can take out a loan for almost any reason including home improvements, buying a car, taking a holiday and a whole host of other reasons.

What does 'representative APR' stand for?

The 'representative APR' (annual percentage rate) is the interest rate we charge to the majority of our customers who take out an agreement for a particular loan amount. We may offer a different APR based on your personal circumstances and the amount that you want to borrow.

How do I apply for an AA Loan?

You can apply online now.

What information do I need to apply for an AA Loan?

To complete your AA loan application we'll need:

  • a form of identification
    • if you're a UK resident (excluding Northern Ireland) your passport, driving licence or a recent electricity bill
    • if you're resident in Northern Ireland your passport
  • a landline telephone number (if you don't have a home phone, this can be your broadband number)
  • your residential history for the last three years (including postcode)
  • your bank or building society current account details
  • your credit or debit card details

What is credit scoring and how do you use it?

Using the information you have provided, together with details from a credit reference agency, we assess your application and give it a score. This score is then matched alongside our 'acceptance' score, which is based upon detailed analysis of our experience with previous applicants.

If your application reaches the 'acceptance' score, your application is accepted. If it does not reach this score, it is refused. Credit scoring evaluates the risks attached to an application. This doesn't mean that a refused applicant is a bad payer, but simply means that our acceptance requirements haven't been met.

Is there a fee for arranging my loan?

No, there isn't a fee to arrange an AA Loan.

How quickly will I receive a decision on my loan application?

In many cases we are able to provide an approval decision instantly after you apply online, However there may be times when this isn't possible or we may need to request additional information.

How secure is my online loan application?

You can rest assured that every online loan application is protected by the latest 128-bit encryption security software.

What happens if I want to repay my loan early?

You may repay all or part of your loan early at any time. If you repay part of your loan early your monthly repayments will be reduced but the duration of the loan period will remain the same. If you settle the loan early in full, you may have to pay interest on the amount repaid or the amount of interest that may be payable depending on the length of your loan.

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Personal loan

Representative example

 

£7,500 over 60 months

 

at a fixed interest rate of 4.7% per annum would result in a representative APR of

4.7% APR

 

monthly repayments of

£140.16

 

and a total amount payable of

£8,409.60