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0% car finance deals – your questions answered


Nov 10, 2020

We might be living in uncertain times, but we all still need to travel. And that’s why even though we’re in the midst of a pandemic, car sales are still strong. So, if you have a good credit rating it’s good to know that there are carmakers which will offer you interest-free credit with no deposit to pay. The specialists over at Rix Motors can help you with your car finance if you need assistance.

What deals are on offer?

A common deal is the offer of not having to pay anything for the first three-months. Audi, Skoda, Vauxhall, Dacia and Renault are just some of the carmakers opting for this. Most of these have a slightly higher APR rate attached. However, some combine a 0% finance deal with a no deposit one.

This means there’s nothing to pay for the first three-months, plus you won’t be charged any money for spreading the payments out.

Who’s offering zero per cent, no deposit deals on new cars?

Right now, Nissan, Renault, Suzuki and Vauxhall are – and we’ll be giving you the low-down on their offers. No deposit 0% APR deals are pretty rare, so don’t expect to find too much variety. But they are there if you shop about, and the finance experts at Parkers  have done the searching for you.

What does no deposit mean?

No deposit is a pretty easy thing to get your head around. It means there’s nothing to pay up front. One way you might see this expressed is via a deposit contribution. These are sums of money carmakers or dealers (or on occasion, both) stump up towards a car finance agreement. One way in which a dealer might offer a no deposit deal is by providing a deposit contribution big enough to cover the entire deposit.

What is zero per cent car finance?

A zero per cent APR car finance deal allows customers to spread the price of a car over a number of years, divided into set monthly payments, with no additional charges. It’s basically like taking out a loan but without any interest fees added. Generally zero APR deals are available on Personal Contract Purchase (PCP) and Hire Purchase (HP) style agreements.

Zero per cent finance on used cars with no deposit

This kind of finance with no deposit on used cars is available, but in some instances, it isn’t quite the bargain it seems. Instead of the seller charging money in the form of interest, they simply increase the total price to cover the money they would have made from APR.

An example: If you bought a car from a dealer for £10,000 on a Hire Purchase style agreement with a 5% APR rate, you would pay in total £10,500 over the course of the agreement (assuming for ease that the agreement is over 12 months). £10,000 for the car, and £500 in interest. Some of these used car zero per cent finance schemes allow you to skip the deposit. But then the dealer simply adds that £500 worth of interest on to the cash price of the car.

Nissan no deposit 0% APR car finance deals

Nissan is now offering a stream of new deals to entice people into showrooms, virtual or real. The company offers a 0% APR deal on the Micra, Qashqai, and X-Trail, but if you want a no deposit and 0% APR deal combined, it’s only available with the Micra.

Renault no deposit 0% APR car finance deals

Renault was the Parkers new car finance award winner for 2020, and with deals like these, it’s easy to see why it’s still a winner. The Clio and Captur, are both available on a scheme that enables buyers to put down no deposit, while also offering 0% APR agreements.

Suzuki no deposit 0% APR car finance deals

To celebrate the introduction of Suzuki’s new mild hybrid engine range, every model is available with 0% APR and £0 deposit. The deals aren’t too restrictive either – they’re available on 25, 37, and 49 month contracts.

Vauxhall no deposit 0% car finance

Vauxhall is well known for its deal making abilities, and this one’s a stonker. The British company is combining 0% APR over a four-year PCP agreement with no money down. There’s also the option of taking a three-month payment holiday at the start of the agreement. Plus, there’s a job loss payment waiver. This allows customers to waive up to six monthly payments if they suffer an involuntary redundancy.

What’s the takeaway?

As you’re not paying a deposit, you’re increasing the money you’re borrowing. Lenders do not like lending large sums of money with low credit scores as they’re more of a risk. It’s a good way of spreading the cost without financial penalty, but it’s only those with the best credit ratings who are going to benefit.

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