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Car loans

Car loans

From 6.0% APR representative for Nectar members

Apply online for our car loans and borrow up to £40,000. Whether you’re buying a new car or picking up a used vehicle, a car loan could steer you in the right direction.

Use our loan calculator to find out what your repayments and interest rates are without hurting your credit score. 

Personal loans for cars

Got your heart set on your dream car? Or perhaps you just need a little more space in the back?

A personal loan from Sainsbury’s Bank could help you cover the cost of a new or used car. We offer loans for cars ranging from £1,000 to £40,000 if you’re a Nectar member, non-Nectar members can borrow up to £25,000.

Why choose Sainsbury’s Bank for your car loan?

Here’s everything you need to know about car loans with Sainsbury’s Bank:

  • From 6.0% APR representative for Nectar members when you borrow £7,500 - £15,000 for 1-5 years

  • You can pay back your loan over 1-7 years (depending on your loan value) with manageable, fixed monthly instalment

  • You can borrow between £1,000 - £40,000 if you’re a Nectar member, non-Nectar members can borrow up to £25,000  

  • No application or arrangement fee

  • You could get your money in as little as 2 hours, or the next business day, if you’re accepted  

Our loan application is quick and easy to complete, you can sign your agreement online, and upload any documents we might need.

How do car loans work? 

Car loans let you borrow a set amount of money to finance a new or used car purchase. The loan amount, plus interest, will then be repaid over a period of time with monthly repayments.

Car loans are a type of personal loan, also known as an unsecured loan, which isn’t tied to one of your assets – like your home.  

If you wish to get a car loan, you’ll need to work out how much you want to borrow and for how long. Our handy loan calculator can help give you an estimate of:

  • Monthly loan repayments

  • Total amount to repay

  • Illustrative APR

  • Annual interest rate

If you’re successful with your application, you’ll need to sign your loan agreement, then your loan amount will be paid into your bank account. Your repayment schedule will be set, so you’ll know exactly what you need to pay each month.

How much can I borrow?

Up to £40000 if you are a Nectar Member and up to £25000 if not.  Our car loans calculator can steer you in the right direction. You can quickly work out what your monthly payments and interest rate could be – and how much you’ll repay in total.

Then using our eligibility checker, in just a few clicks, you can find how likely you are to be accepted – without harming your credit score.

All quotations given are for illustrative purposes only. Credit is subject to status.

Find the right loan for you

You might need £5,000 or less for a used hatchback, but you could borrow in the region of £10,000 for a used luxury car. Or you might be planning to spend £30,000 on a new model. Either way, we've got the loan to suit your needs.

If you’ve got a question about our loans – our support section is a great place to start.

Our loan terms

Before you take your car for a test drive, it’s a good idea to do your research about finance and bank loans. 

To apply for a car loan with us, you must:

  • Be at least 18 years old on the date you apply

  • Be no older than 83 when the loan is due to be fully repaid

  • Be in permanent employment, self-employed or retired with a pension

  • Have an annual income of more than £7,500 per year

Other key information to be aware of before you apply includes:

  • Payment is made by monthly Direct Debit, with interest charged between the start of your loan and your first monthly repayment

  • The interest rate is fixed and guaranteed for the life of the loan

  • There is no application/arrangement fee

Take the time to understand how our loan terms, lending criteria and things you should think about before you apply.

Things to consider when buying a car

Ways to pay for a car

Taking out a loan for your car is a helpful way to cover the costs of purchasing a used or new car. You can take out a bank loan to pay for your car, or if buying from a dealership, you may be offered car finance directly.

Securing a loan means you become a cash buyer, which often helps with any negotiations. There will be no set up fees and once you’ve paid off your loan, you own the car at the end.

Find tips on buying a car.

Personal contract purchase

Other ways you can buy a car include personal contract purchase, which you can arrange if you choose to buy through a dealership. This usually involves paying a deposit for the car followed by a series of regular monthly instalments.

You won’t fully own the car until you make the final personal contract purchase ‘balloon’ payment. A balloon payment is when you pay more at the end of your loan term than earlier monthly payments. It allows you to reduce your monthly fixed payment to an affordable amount by agreeing to pay more when your loan comes to an end.

Leasing your car

You can also lease your car, which means you agree to a long-term rental where you pay a monthly fee in exchange for a car. The payment is fixed but you never own the car and when the lease is up, you return it and you can upgrade to a new model.

Trade in

If you are looking for a car upgrade, trading in your old car against a new one is a popular option. You are effectively part-exchanging your existing vehicle for the new one. The dealership will take the value of your old car off the price of your new one. A loan can then be used to pay the difference.

Running costs of your car

It’s easy to get caught up in the purchase price, but you might also want to consider typical car running costs.

Car insurance

Age and claim history are among the many factors that can make car insurance one of the biggest expenses. For more information, check out our car insurance options.


Different types of cars have different tax rates, you can check the GOV.UK opens in new window tax rates table for an up-to-date list.


Cars more than three years old need an MOT test every year, the maximum cost that test centres can charge can be found on GOV.UK opens in new window.


Regular health checks on your car can save you both trouble and money. Read our guide for tips on car maintenance.

Miles Per Gallon (MPG)

MPG is the standard measure used to show how many miles a car will travel per gallon of fuel. Choosing a car that offers good MPG or perhaps even an electric or hybrid car, can save you money on fuel over time.

How to apply for a car loan

Applying for a car loan is quick and easy with Sainsbury’s Bank. Just follow these simple steps:

Step 1 – Use our loans calculator

Firstly, use our loans calculator to check how much your loan could cost you. Our tool uses our representative example* to show you what your estimated repayments may be, the total amount you’ll need to repay, as well as what the illustrative APR and annual interest rate could be.

Just enter:

  • What you’d like to borrow
  • How long you would like your loan repayments to last
  • Your Nectar card number if you’re a Nectar member
  • Whether it’s a single or joint application

Step 2 – Have your personal details to hand to apply

If the results from our loan calculator work for you, you can start your application. You’ll see a selection of key information and Terms and Conditions  to read first. This includes loan eligibility and lending terms. If you’re happy to continue, you can begin.

You’ll be required to enter some personal details to start. It’s worth having this information directly to hand during your application. 

You’ll be asked to provide your:

  • Name, date of birth and nationality
  • Email address and contact number
  • Loan purpose – select ‘Car/Bike’
  • Home address and residential status
  • Marital status and details of any co-dependents

Financial and occupational details are also needed to process your application. This includes:

  • Employment status
  • Occupation and employer’s name
  • Annual income
  • Mortgage or rental payments
  • Bank details

Step 3 – We will run our credit and approval checks

Once you submit your details, we’ll take the information you’ve given us and conduct our lender checks. We’ll start by checking your application details and running through your credit report.

A soft credit check will happen to begin with, where we’ll take a top-level look at information included in your credit report. This won’t appear on your credit report and isn’t visible to credit agencies.

We’ll then conduct a hard credit check, which will appear on your credit report, and is a much more in-depth look at your financial history.

Step 4 – Receive a decision

If your application is successful and you pass our series of checks, you can sign your agreement online and upload the relevant documents, in order to receive your car loan. Once the loan agreement has been signed, your money will be paid into the bank account that you listed during your application.

If you already have a loan with us, you could potentially borrow more. Explore your options for topping up your loan.

Buying a used car?

Before you purchase, it’s worth thinking about the pros and cons of buying a used car. In our guide, we’ve got some tips that help you decide if buying a used car is the right decision for you.

Useful guides

Looking for more information? We have a range of helpful loans tools and guides.

Can I afford a loan?

Our guide covers different types of credit, budgeting, APR, credit scores and much more.

Loans glossary

Our A-Z glossary sheds light on loan terminology and can be used as a jargon buster.

All guides

Check out all our tools and guides, from planning your financial future to our loan application checklist.

Frequently asked questions

Can I get a car loan with bad credit?

Yes, it’s possible to get a car loan with poor credit. However, this will depend on your personal circumstances and whether you pass the relevant lender checks that are conducted when you apply.

If you have bad credit and are unsure whether you will be accepted for a loan with Sainsbury’s Bank, learn more about how you could improve your credit score, before applying.

How much does a car loan cost?

The cost of your car loan will depend on your borrowing terms any added interest. For example, if the loan is £10,000 with a 5% APR over 60 months, and you pay £188.20 per month, the total cost would be £11,292, based on our representative example.

Can I repay my car loan early?

Some lenders will allow you to repay your car loan early, although they may charge an early repayment fee and this decision is at their discretion.

At Sainsbury’s Bank, all loans can be repaid early, and we offer flexible options for repaying. 

Find out more.

How quickly can I get a car loan?

Once you’re approved for a car loan with Sainsbury’s Bank, we will transfer the money to your account in as little as two hours, or the next business day. 

What can’t I use my car loan for?

Your car loan cannot be used for purchasing property or land, mortgage payments, buying shares, gambling or business purposes.

Check out our loans key information page to find out more.

Representative APR applies to loans of £7,500 - £15,000, between 1-5 years, for Nectar members. Other rates apply to other loan amounts.   

We treat all our customers and their applications on an individual basis. The APR we offer is determined by the details you supply and the loan you are applying for, along with an independent verification of your credit and repayment history.