Black Box Car Finance

Black box car finance is designed to keep you and your car finance repayments on track.

Black box car finance is ideal for motorists who forget to make their car finance repayments every month. It sends a reminder to users ahead of the payment date so they can get their finances in shape before the day.

You may have heard of black box insurance; that is what insurers may recommend installing to monitor how and at what times you drive to help reduce your insurance bill.

Black box finance is different. They are not interested in your car driving habits but in your car finance repayment habits instead. The process is similar to black box insurance, though; you will have a device fitted into your vehicle.

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The device gets connected to its internal computer so it can communicate directly with your lender through GPS. It's a great option for those with bad credit or whose job or income changes frequently.

While it's quite rare to apply for this type of finance, some lenders specialise in this type of loan, and you should research these companies before applying, especially if you think a black box could help you.

How does black box car finance work?

Black box car finance works by reminding you every time your car finance repayment is due. You may receive an email or text message or communication from the box itself.

Once you have made your payment for that month, the box will reset, and you may get asked to enter an activation code. At the end of your finance agreement, the black box gets removed.

Black box car finance is generally only available on Hire Purchase (HP) finance deals. HP finance allows you to spread your payments across fixed monthly instalments before owning the car outright at the end of the term.

You'll likely be required to put down a deposit at the beginning - usually around 10% - and then make your repayments over an agreed period - typically one to eight years.

Although you won't own the car until the end of the deal, you will be responsible for getting regular services and MOTs. However, you won't be allowed to sell or modify the car.

What happens if you miss a repayment?

You will receive reminders every month ahead of your upcoming payment, but if you were to miss this or you don't have the funds to afford it, you will get given a 30-day grace period to make your repayment.

However, if you don't make the repayment before the end of the grace period, the black box in your car can deactivate your car, so you can't use it until the payment has been made.


That may cause concern for you, especially if you are out driving, as stopping suddenly against your will could cause an accident. The black box knows when the car is in motion, so would only trigger the deactivation of the vehicle if the car is idle.

If it does get to this point, there's a chance that you won't be able to drive the vehicle again, and it may get repossessed. It would also significantly impact your credit score and future borrowing power.

Is black box car finance a good option for you?

If you've struggled in the past to keep up with monthly repayments, or you're in a job role where your monthly salary payments fluctuate, black box car finance could be good for you.

It's good to get reminded of when to make your repayments so you can always stay on top of them. However, some may find it intrusive, especially as the technology can influence whether your car turns on or not.

Not all lenders offer black box car finance, so finding one that does that also offers a good APR may be tough. You should also consider that they generally only offer them on HP deals, so you would be keeping your car once the term ended.

Black box car finance with bad credit

If you have poor or no credit, or have missed repayments in the past, black box car finance might be a good option to help you get approved, as a lender can communicate with you regularly to ensure repayments get made.

Lenders will also see your willingness to accept having a black box as a positive, as it means you will do everything you can to ensure you can fulfil your repayments.

It should also help you build credit over time, provided you can make your repayments, thus giving you a better chance of being approved for loans again in the future.

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Black box car finance with no credit check

If you want to get black box finance - or any type of finance for that matter - you will be expected to have a check of your credit history and score to ensure you can make your repayments.

Soft credit checks are necessary to see if you could be approved, and hard credit checks are required when you officially apply for finance, so lenders can be assured you are fit to repay.

Car finance is not a guarantee for anyone, no matter your wealth status, so it's important to know that you will undergo a credit check to discover if your circumstances make you a good fit for a loan.


Can I remove black box car finance myself?

The black box fitted in your car to help you track your car finance repayments can only be removed at the end of your agreement. Early or unauthorised removal could violate the terms of your agreement.

Can I pay off my car finance early?

If you have the money to do so, you could ask your lender for your early settlement figure and pay off the sum so you no longer have to make finance repayments. Doing this will make you the outright owner of the car, and any black box car finance you had fitted would be removed.