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Early Settlement Calculator

Thinking of paying off your car finance early? Under the Consumer Credit Act, you have the right to settle most agreements early and receive a rebate on future interest. Enter your original loan details to estimate your settlement figure.

Reviewed by Richard Ross · Last updated April 2026

How Early Settlement Calculator works

How the early settlement figure is worked out

A settlement figure is not simply the payments you have left to make. It is the present value of those remaining payments — the outstanding balance — minus a rebate of interest you have not yet incurred. Section 94 of the Consumer Credit Act 1974 gives you the right to settle a regulated agreement early, and section 97 requires the lender to provide the figure on request, in practice within about 12 working days. The rebate is calculated under the Consumer Credit (Early Settlement) Regulations 2004, which let the lender retain up to roughly 58 days of interest when working out how much to give back. That retained interest is why a settlement figure is a little higher than the pure outstanding balance, and why settling saves less than the headline "payments remaining" total suggests. This calculator estimates the figure from your original loan, APR, term, and months paid; your lender's exact figure may differ slightly because of fees or rounding, so always confirm it with them before acting.

Worked example: settling an £18,000 loan halfway through

Take an £18,000 loan over 48 months at 6.9% APR — the default in the calculator above. The monthly payment works out at about £430. After 24 months you have paid roughly £10,325, but because the outstanding balance is the present value of the 24 payments still to come, it sits at around £9,618 rather than half the original loan. The settlement figure is that balance minus the statutory interest rebate. Under the 58-day rule the rebate here is only about £105, leaving a settlement figure of roughly £9,513. Settling now therefore costs about £9,513 instead of the £10,325 you would otherwise pay over the remaining two years — a saving of around £810 in interest you never reach. The earlier in the term you settle, the larger that saving, because more unearned interest is still sitting in the balance.

Settling when you are in negative equity

Negative equity means your settlement figure is higher than the car is currently worth. It does not change your statutory right to settle, but it does change how you fund it. If you settle with cash, you simply pay the figure and the agreement closes. If you are part-exchanging or relying on a sale to clear the finance, you have to cover the shortfall between the sale price and the settlement figure out of your own pocket, or roll it into a new agreement. PCP agreements are the most likely to be in negative equity in the early years, because the deferred balloon keeps the settlement figure high while the car depreciates fastest. Check the figure against a realistic trade-in or private-sale valuation before you commit to selling.

What the settlement figure does not include

The figure your lender quotes covers the outstanding balance less the interest rebate, but a few things sit outside that calculation. On PCP, the balloon payment (the Guaranteed Future Value) is part of the balance you are settling, so the figure is larger than your monthly payments alone imply, and clearing it is what makes you the owner. Some older or unregulated agreements carry a separate early repayment charge written into the contract — a percentage of the balance or a flat fee — on top of the 58-day interest. And the figure is time-limited: it is usually only valid for a set number of days, after which interest accrues and you must request a fresh one. If your agreement might carry an extra charge, run the numbers through the early repayment charge calculator before deciding.

Further reading

Settling is only one of three ways to clear car finance early. Our guide compares early settlement, voluntary termination, and refinancing, and explains when each one actually saves money.

How to pay off car finance early in the UK →

Frequently asked questions

How is the early settlement figure calculated?

The settlement figure is the present value of all remaining payments (the outstanding balance) minus an interest rebate. Under the Consumer Credit Act, the minimum rebate is 58 days of interest on the outstanding balance.

Do I have a right to settle early?

Yes. Under section 94 of the Consumer Credit Act 1974, you can repay a regulated credit agreement early at any time. The lender must provide a settlement figure within 12 working days of your request.

Are there early settlement fees?

For most car finance agreements, the only charge is up to 58 days of additional interest (not a fee, but a cap on how much rebate the lender must give). Some agreements taken out before 2005 may use different calculation methods.

Should I settle my car finance early?

It depends. Settling early saves interest, but make sure you would not be better off investing the cash elsewhere. Also check whether your agreement has a fixed-sum early repayment charge (rare in UK car finance but possible on older agreements).

How do I get a car finance settlement figure?

Ask your lender directly — by phone, through your online account, or in writing. Under section 97 of the Consumer Credit Act 1974 they must provide a settlement figure for a regulated agreement on request, in practice within about 12 working days. The figure is the outstanding balance minus the statutory interest rebate. This calculator gives you an estimate in advance from your original loan details, but the lender's figure is the binding one, so confirm it with them before you arrange to pay or sell the car.

How long is a car finance settlement figure valid?

A quoted settlement figure is usually valid only for a set period — commonly around 10 to 28 days, depending on the lender — because interest continues to accrue on the balance until you actually pay. If the quote lapses, you simply request a fresh one. When you are coordinating a sale or part-exchange to clear the finance, line up the payment within the validity window so you are not caught out by a slightly higher figure. Always check the expiry date printed on the figure your lender provides.

Why is my settlement figure higher than I expected?

The most common reason is the interest rebate. Under the Consumer Credit (Early Settlement) Regulations 2004 the lender can retain up to roughly 58 days of interest, so the figure is higher than the pure outstanding balance. On PCP it is higher still, because the deferred balloon payment forms part of the balance you are settling. A separate early repayment charge in older or unregulated agreements can add more. If the figure looks wrong, ask the lender for a written breakdown of how it was calculated.

Can I get an early settlement figure on a PCP?

Yes. Section 94 of the Consumer Credit Act 1974 gives you the right to settle a PCP early, and the lender must provide the figure. The difference from HP is that the balloon payment (Guaranteed Future Value) is part of the balance, so the settlement figure is larger than your monthly payments alone suggest. Settling clears the balloon and makes you the owner. If you only want a cheaper monthly payment rather than ownership, compare settling against refinancing before you decide.

These calculations are estimates based on 2026/27 HMRC and DVLA rates. Speak to a lender or qualified financial adviser for a personalised quote.