In order to buy a car with a low interest loan it would be better to go in for personal loans. It would be possible to get up to £20000 as loan and repayment period can be up to 5 years. Since the repayment period is long, the monthly repayment amount would be lesser and therefore it would not become a burden for the borrower. Most of the personal loans are with fixed interest rate and so the borrower need not have to worry about an increase in interest rate in future years. Such loans could be applied online just by giving few personal and employment details anybody in UK could obtain the loan. It could also be applied through telephone call. Most of the lending companies would help the borrower in calculating the correct loan amount he could take within his budget (Low interest rate car loan, 2007).

In order to get car loan with the lowest interest rate the first thing the borrower should do is to decide the repayment period required. The interest rate and the amount to be paid per month would be less if the repayment period in long. Next he should decide the type of loan he requires, whether a secured loan, unsecured loan, or depending on his credit history a bad credit loan or even a no credit check loan. The interest rate would depend on the risk taken by the lender in providing loan. A secured loan would be having the lowest interest rate, since there is a collateral and the lender could get the money back in the event of not paying the loan back. But interest rate for unsecured loans would be higher and loan for a person with poor credit history would be much higher. The car finance provided by the dealers also would have a high interest rate. Therefore the borrower should decide the type of loan he requires based on his conditions, and the details could be given to a loan specialist for getting the loan with the lowest interest rate best suited to the conditions of the borrower (Easy car loans, 2007).

Thus it could be seen that car loans in UK comes in different colors and interest rate depends on the type of the loan that is selected by the borrower, depending on his condition.