Can you swap finance from one car to another?
Alisa Dan
You can’t swap a car finance agreement to another vehicle because the contract is built around one financed vehicle and one borrower. That’s the point most drivers discover only when they try changing cars mid-agreement.
A car finance agreement is created using detailed data about your current financed vehicle: its age, mileage, condition, expected depreciation and projected resale value. And because the lender owns that asset until you clear the balance, the agreement cannot be detached from that specific car or reassigned to a replacement vehicle.
But you can still change cars. You simply end or reshape the original agreement before starting the next one. The decision always begins with two entities: the settlement figure, which shows what you owe today, and the trade-in valuation, which shows what your financed vehicle is worth. Those two numbers reveal whether you have positive equity that can help you move forward or negative equity that you must deal with.
Your routes are straightforward:
- Settle and start a new agreement.
- Part-exchange, letting the dealer settle the finance for you.
- Refinance if you want to keep the same car but adjust the payments.
- Voluntary termination if you meet the legal conditions and the car is no longer affordable.
Why you can’t simply move your finance to a replacement vehicle
You can’t move a car finance agreement to a replacement vehicle because the lender’s contract, pricing and security are tied to the original financed vehicle. That single fact shapes every restriction you meet.
A HP agreement or PCP agreement is calculated around the financed vehicle itself — its depreciation curve, resale value and predicted condition at the end of the term. And because the lender holds legal ownership of that car until the agreement is settled, they cannot allow the financed vehicle to be swapped for a replacement vehicle without rebuilding the entire agreement from scratch.
Meanwhile, every key figure in the contract depends on that asset. A PCP agreement relies on a specific future value. An HP agreement relies on a fixed path toward ownership. Swap the vehicle, and those assumptions collapse instantly.
And the lender’s security interest disappears the moment the financed vehicle changes hands.
Legally, a car with outstanding finance cannot be sold or swapped without settling the agreement.
Can I change my car before my finance ends?
Yes, you can change your car before the agreement ends, but you must deal with the existing car finance agreement tied to your financed vehicle. Drivers do this whenever their needs change, but the lender still requires the original contract to be settled or restructured.
The process always begins with the settlement figure. It’s the amount needed to end your PCP agreement or HP agreement today. Then you compare it with the trade-in valuation of your financed vehicle. That simple comparison tells you whether you hold positive equity that can go towards your next deposit or negative equity that needs attention.
What you can do if you’d like to swap a financed vehicle
You can’t move a car finance agreement to another vehicle, but you can replace your financed vehicle by ending or restructuring the agreement first.
Payment of the settlement figure
Paying the settlement figure ends the car finance agreement and releases the financed vehicle.
Once the lender is paid, you’re free to sell, part-exchange, or move to a replacement vehicle. Drivers choose this route when they hold positive equity or want full control before taking new finance.
Voluntary termination
Voluntary termination lets you return the financed vehicle and end the agreement once 50% of the total amount payable is covered.
It’s a legal right and suits situations where the car is no longer affordable. VT doesn’t move you into a replacement vehicle; it simply closes the current contract.
Refinancing your car
Refinancing replaces your current car finance agreement with a new one, letting you keep the financed vehicle but adjust the payments.
A refinancing loan settles the old deal and creates new terms, useful when negative equity or tight budgets make a swap difficult.
Part-exchanging on finance
Part-exchange lets a dealer value your financed vehicle, settle the agreement, and move you into finance on a replacement vehicle.
Positive equity reduces the deposit; negative equity may need paying or rolling into a new PCP or HP agreement.