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The short answer
You can get car finance in the UK with little credit history, but lenders decide from your UK credit file, which starts almost empty when you arrive, so offers may be smaller, dearer or need a larger deposit. Hire purchase and PCP are both hire purchase agreements under the Consumer Credit Act, which lets you hand the car back once you have paid half the total price.
A car is often the first large purchase a Nigerian family makes after moving to the UK, especially outside London or for shift work. The finance offered at dealerships is almost always one of two products: hire purchase (HP) or personal contract purchase (PCP). The Financial Conduct Authority describes PCP as a type of hire purchase agreement. Understanding how both work, and what a lender sees when it checks a new arrival, is worth more than any trick for getting approved.
Why a thin file matters
UK lenders check your record with credit reference agencies. The Information Commissioner's Office names the three main consumer agencies as Equifax, Experian and TransUnion, and says they hold information on how you have run credit and utility accounts, your previous addresses, the electoral roll, and public records such as county court judgments and insolvency. A new arrival has little or none of this, so the lender has less to go on. That is a thin file, not a bad one, but the effect can be similar: a decline, a lower amount, or a higher rate.
Lenders do not have to report to all three agencies, so your file can look different at each. You can request your statutory credit file from each agency free of charge. Our guides to checking your UK credit report for free and building a UK credit score from zero cover the steps.
HP and PCP compared
| Hire purchase | Personal contract purchase | |
|---|---|---|
| What you pay | Deposit, then fixed monthly instalments | Deposit, lower monthly instalments, then an optional large final payment |
| Ownership | Yours after the final instalment | Yours only if you make the final payment |
| At the end | Car is yours | Pay the final amount, hand the car back, or part-exchange |
| Typical extras | Few | Usually an annual mileage limit and condition charges if the car is returned |
| Legal type | Regulated hire purchase | Regulated hire purchase (FCA) |
Because a PCP's monthly payment is lower, dealers often lead with it. The total cost is what matters: add the deposit, every monthly payment and the final payment, and compare that with the cash price.
Your right to hand the car back
Section 99 of the Consumer Credit Act 1974 lets you end a regulated hire purchase agreement at any time before the final payment falls due, by giving notice to the lender. Section 100 sets the cost: you must bring what you have paid up to one-half of the total price, unless the agreement asks for less, plus compensation if you have not taken reasonable care of the car. This is called voluntary termination, and it applies to PCP as well as HP.
Worked example (figures are illustrations)
- PCP: £1,000 deposit, 36 payments of £300 and a final payment of £8,200 make a total price of £20,000. Half is £10,000. The deposit plus 30 monthly payments reaches exactly £10,000, so from month 30 you could hand the car back with nothing more to pay under section 100, if it is in good condition.
- HP: £1,000 deposit and 48 payments of £375 make £19,000. Half is £9,500. After 22 payments you have paid £9,250 and would owe £250 more to terminate; after 23 payments you have paid £9,625 and owe nothing more under section 100.
This right matters to visa holders. If your circumstances change, voluntary termination is a defined exit with a known cost, rather than missed payments that damage the file you are trying to build.
Improving your chances without guessing
- Register on the electoral roll if you are eligible: the ICO lists it as one of the sources agencies use. Our guide to whether Nigerians can register explains eligibility.
- Build a short UK record first: a current account in good order and a phone contract or credit builder card paid on time.
- Put down a larger deposit and borrow less. A smaller amount relative to the car's value is less risk for the lender.
- Choose a cheaper car. The same lender may decline a high amount and accept a lower one.
- Use eligibility checks offered by lenders before applying in full, so you do not collect several hard searches in a short time.
- Have your evidence ready: payslips, UK bank statements, proof of address and your immigration status. Some lenders ask how long is left on your visa.
Before you sign
- Check the total amount payable and the APR, not only the monthly payment.
- Price insurance first. If you are still driving on a Nigerian licence, read the 12-month rule and insurance with a Nigerian licence.
- For a PCP, check the mileage limit and charges for excess mileage and wear.
- Work out the half-way point of the total price so you know your exit.
The FCA is also running a compensation scheme for some car finance agreements taken out between 6 April 2007 and 1 November 2024; it is relevant only if you had UK car finance in that period.
Questions people ask
Can I get car finance with no UK credit history?
It is possible, but lenders judge you mainly on your UK credit file, which starts almost empty. Expect smaller amounts, higher rates or a bigger deposit until you have a few months of UK record.
Is PCP or HP better for a new arrival?
HP leads to ownership with no large final payment; PCP has lower monthly payments but a big optional final payment. Compare the total amount payable on each.
Can I give my financed car back early?
Yes. Under sections 99 and 100 of the Consumer Credit Act you can end an HP or PCP agreement once you have paid half the total price, unless the agreement asks for less.
Does my Nigerian credit history count for UK car finance?
UK lenders rely on UK credit reference agencies, which hold records of UK accounts. See our guide on whether Nigerian history counts.
Sources
- FCA: Car finance complaints (updated 13 Oct 2026) · accessed Oct 2026
- ICO: Credit reference agencies and your credit file · accessed Oct 2026
- Consumer Credit Act 1974, section 99 · accessed Oct 2026
- Consumer Credit Act 1974, section 100 · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.