Close Brothers Car Finance: How It Works, Rates & Alternatives

Who is Close Brothers Motor Finance?

Close Brothers is a direct lender, not a broker. It provides the funds itself, usually for cars bought through a partner dealer, and is part of the Close Brothers banking group.

Because Close Brothers lends its own money, the agreement is between you and Close Brothers for its whole life. Payments, settlement figures, end-of-term choices and any complaints all go to the lender. It must be FCA-authorised and run an affordability check before lending, like every UK motor finance provider.

Close Brothers has historically worked across a broad credit spectrum, including customers who may not fit the standard prime profile, which matters when you read the APR you're offered. Your Consumer Credit Act rights apply in full, including voluntary termination at 50% and early settlement with an interest rebate.

What products does Close Brothers offer?

Close Brothers typically provides Hire Purchase (HP) and PCP through dealers, on used and newer cars.

HP spreads the whole car price over the term so you own the car at the end; there's no balloon. PCP keeps the monthly lower with the optional final payment (the balloon, set at the GMFV), but that lower monthly usually means a higher total amount payable over a longer term. The right product depends on whether you want outright ownership, a low monthly, or the flexibility to change cars.

Because the finance is arranged where you buy the car, the dealer sets up the credit agreement and the lender funds it. The exact product, APR and term appear on your pre-contract document (SECCI) before you sign.

• Hire Purchase (HP): own the car after the final payment. Model it on the HP calculator.
• PCP: a lower monthly with an optional final balloon. Model it on the PCP calculator.
• Dealer-arranged: agreements are usually set up where you buy the car.
• Used and newer cars: both are covered, with a strong used-car focus.

What rates and eligibility does Close Brothers look at?

Your Close Brothers rate depends on your credit profile and the car, not a fixed advertised figure: the APR is set after a credit and affordability check.

Lenders that work across the credit spectrum use a rate-for-risk approach. The representative APR a lender advertises is the rate it reasonably expects at least 51% of accepted customers to get, so the rest can pay more. Where you sit depends on your file, the car's age and the deposit. A higher APR over a longer term multiplies the interest.

Rather than rely on a headline rate, turn any quote into its real cost with our APR calculator, which shows the total interest in pounds. A stronger credit file and a bigger deposit generally cut the APR and the total interest.

How Close Brothers compares — your alternatives

Close Brothers is one of several dealer-finance lenders; the cheapest option is whichever has the lowest APR over the shortest term you can afford.

Compare on the total amount payable, not the monthly. Check the figures on the main calculator before you decide.

The motor finance commission context

Close Brothers is one of the lenders most exposed to the motor finance commission story: it used Discretionary Commission Arrangements (DCAs), faced a Court of Appeal ruling against it that the Supreme Court later overturned, and has confirmed it will not challenge the FCA's redress scheme.

Under a DCA, a dealer or broker set your interest rate within a range and earned more commission the higher it went. The FCA banned DCAs in January 2021. A Court of Appeal ruling in 2024 went against Close Brothers (alongside another lender) over undisclosed commission. On 1 August 2025 the Supreme Court allowed the lenders' appeals on the bribery and fiduciary claims, including Close Brothers', but found one FirstRand (MotoNovo) customer's relationship unfair under section 140A of the Consumer Credit Act 1974. The FCA then confirmed an industry-wide redress scheme in 2026 (PS26/3, 30 March 2026) covering agreements from 2007 to 2024. Parts of it have been suspended since 29 June 2026 pending a legal challenge due to be heard 16 February to 3 March 2027, and payouts are expected in 2027 at the earliest, if the scheme is upheld and the judgment is not appealed.

Close Brothers has stated publicly it will not challenge the redress scheme, and its motor finance arm hosts a commission-complaints page for customers who want to complain direct. If you have (or had) a Close Brothers agreement from that period, undisclosed commission may have raised your rate. The scheme is free for consumers to use directly. You don't need a claims firm. Read whether your agreement could have been mis-sold and estimate any redress yourself, free.

Eligibility posture — where Close Brothers sits on the credit spectrum

Close Brothers works across a broad credit spectrum, including customers that prime-only lenders often decline, which is why two buyers can leave the same dealer with very different APRs on the same car.

Because Close Brothers accepts a wider range of profiles than a strict prime lender, it uses rate-for-risk pricing: the stronger your file, the larger your deposit and the newer the car, the lower the band you fall into and the lower the APR. A file with recent defaults, a thin credit history, or a small deposit is still considered, but lands in a higher band at a meaningfully higher rate. The band, not the lender's brand, sets the APR on your SECCI.

This is also the context for the commission story. Where a dealer could set the rate within a range under a Discretionary Commission Arrangement, a borrower in a higher band was especially exposed: a small upward nudge on an already-high APR compounds quickly over a long term. If you had an older Close Brothers agreement, check whether it carried hidden commission and what redress might apply on the Close Brothers mis-selling page, free and without a claims firm.