Can I get Poor Credit Car Finance?

Are you interested in buying a new car? Have you been rejected by lenders in the past? Poor credit car finance could be for you! When you are looking to finance a car, you have three main options:

Poor credit ratings shouldn’t prevent you from getting your dream car. Bad credit car finance is available for those with low credit scores and poor credit history. And, you can purchase all kinds of vehicles with it. It’s easy to apply online, and over the phone when you contact our dedicated brokers.

Here’s a guide to bad credit car finance that explains what it is, how it works, and how to get a good deal!

How Does Poor Credit Car Finance Work?

Poor credit car finance and regular car financing options work the same way. But, your chances of getting approved for car finance are decreased.

If you have a low credit score, you will need to prove to lenders that you can make monthly payments on time. This means you will undergo a rigorous financial check carried out by lenders. Through this, they will be able to see that you can make your payments

A deposit is typically required to make sure that lenders have some form of security to make sure their money gets paid back.

What Are The Benefits Of Car Finance For People With Bad Credit?

If you’re after a new car but have poor credit, we could help you. It works similarly to regular car finance. Meaning that when you apply, you will go through the same process as someone would with good credit. However, if you have bad credit, you may find that you will get declined by more lenders. There are some, however, that will accept applicants with bad credit. If you get accepted, lenders may be able to draft you up a payment plan you can afford!

Car finance with poor credit means you could get car finance even if you have been refused in the past. It is important that you don’t make lots of car finance applications in a short period of time. As a result, your credit score will get lowered, making getting car finance more difficult.

What Are The Best Car Finance Deals For People With Bad Credit?

When looking for the best bad credit car finance loan, it’s crucial you understand the terms that come with it. So you don’t miss out.

  • The best deal you could get is car finance with a low APR with a good credit score. If you can’t afford the car you want, it may be better if you take out a loan with a higher APR. Consider whether it’s worth paying more in interest every month for something like this. Remember: if you have bad credit, you will likely get a loan with a higher APR. Which is the opposite of customers who have better credit scores. You will more than likely face different rates.
  • The deposit is essentially security against defaulting on your monthly payments. Your repayments can be lowered by putting down a deposit since it is applied to the overall value of the motor vehicle. But, it is possible to get bad credit car finance with no deposit. To compensate for the down payment you didn’t make, your monthly payments may be higher. Although, you are likely to be accepted for this type of car finance if you have a good credit score. Even though bad credit car finance with no deposit is available, only some lenders will offer it. But this varies from lender to lender since they don’t all offer this option to customers. 

Is It Possible To Get Car Finance With Poor Credit & No Deposit?

If you don’t have a deposit, you could get poor credit car finance. There are many ways for you to pay off your car finance loan. You could pay it off by:

  • Get a guarantor: If you have a good friend or family member, they could act as a guarantor for your car finance application. It’s best to get someone with a really good credit score to be your guarantor. You use them as security for the loan. They would be responsible for making repayments if you are unable to afford your payments on the vehicle. Don’t worry though, we also offer car finance for people who have no guarantor.
  • Dip into your savings: You can save up any extra money you have until enough money accumulates so you can finance your car outright without a down payment!

Other Ways Are…

  • Use your income: For most circumstances considered, you could still afford car finance with your income! However, we understand that you may find it difficult depending on your situation. In most cases, our passionate specialists could help you secure your dream car, for most financial circumstances considered.
  • Apply for joint finance: Joint finance is similar to having a guarantor which means you share the responsibility of making payments with someone else. If you enter an agreement with someone who has a high credit score, you can expect this option to work out better for you. And it means you can apply for better prices. If you want to apply for joint car finance, you will need to meet certain criteria. For example, you may need to live at the same address as with who you will share the agreement. Our brokers will be able to see which requirements need to be met for specific lenders. Puts you in a better position for applying for bad credit car finance.

What If I Don’t Have Any Credit History?

It may be possible for you to get car finance without any credit history. But it’s important to remember fewer lenders will accept you. Lenders see those with no credit history the same as those with poor credit ratings. Which is the group of people you will be lumped with when you enter the application process. So what you get offered may be similar to what people with bad credit will be offered when it comes to car financing deals. Your credit history shows lenders that you can make monthly payments, so having no credit history won’t show this. And you will be seen as someone who can’t prove they can make repayments.

If I Have An IVA, Does It Change Anything?

An Individual Voluntary Agreement (IVA), is a way of making payments to your past creditors at a price you can afford. Because the payment plan is legally binding, it could prevent you from getting accepted for car finance. In order to take out another loan, you will need permission from your IVA supervisor. 

IVAs lower your credit score, meaning there is a higher chance you may get declined for car finance. Although, because of the nature of an IVA, lenders may see you as committed to paying off your debts. Remember that you could still get car finance with an IVA. Before approaching one of our brokers, discuss car financing with your IVA supervisor. Our team will try their best to help you secure your dream car, just make sure you get permission first! 

How Will A CCJ Affect My Chances Of Getting Car Finance?

A County Court Judgement (CCJ), is a high court judgement showing you owe money. It happens when someone makes a claim against you stating you owe them money and you haven’t responded. Having a CCJ lowers your credit score lower because it shows you haven’t been able to pay someone back. 

Unfortunately, it shows up on your credit report for 6 years, whether or not you have paid it in full. This can make it harder for you to get approved for car finance. Lenders see you as more unreliable than those with good credit. It is possible to get car finance with a CCJ, even if it has negatively impacted your credit score. You could increase your chances of getting approved for car finance but make sure you pay off your CCJ in full.

Lenders assess customers’ financial circumstances with CCJs differently and will take into consideration some things.

They are:

  • The amount of outstanding debts you still owe
  • The length of time you haven’t paid off your debts
  • The different kinds of debts you have

If you have an unpaid CCJ against you, all is not lost. You may still get accepted for car finance. We recommend applying through a brokerage service since they have a panel of lenders that could help you. Getting car finance with a CCJ isn’t impossible, but we can’t guarantee you will be accepted.

What Is The Best Car Finance Option For A Low Credit Score?

If you have a bad credit history, then you could apply for a poor credit car loan. For most financial circumstances considered, we aim to provide car finance options to everyone.

Get in touch with one of our passionate specialists to see if you qualify for car finance with bad credit.

Even if you have been refused car finance elsewhere, you could get accepted when applying for car finance through us!

What Are The Requirements For Bad Credit Car Finance?

You will get accepted for car finance if you’re over 18. Because you have to be 18 to take out car finance. You will also need to live in the UK and have a regular income. Some lenders will accept you even if you have a reduced credit score. If you have enough money to put in a down payment for your desired vehicle, this will also increase your chances of getting accepted. Especially if you have bad credit.

Which Dealerships Provide Bad Credit Car Finance?

Dealers licensed by the Financial Conduct Authority (FCA) can work with lenders or brokers to offer any legal car finance solution. This includes loans for people with bad credit. A dealer will likely sell you a car if they know the lender will pay them: the lender takes the risk.

Our panel of reputable lenders means we could help lots of people from different financial circumstances. We will work closely with them to help secure your dream car.

How Long Does The Bad Credit Car Finance Application Take?

Lenders will ask you for some basic information when you apply for a loan. This includes your name, address, and employment details. Your options will be influenced by the lender you apply through and your financial circumstances. Our brokers will work hard to pair you with a lender that could offer you the best deals for your financial situation.

When you apply for a bad credit loan, it could take less than 24 hours and may be completed within minutes. If you’re lucky enough to be approved in this time period, then congratulations! You’ve just saved yourself a lot of time!

If your application does not get accepted on its first submission, don’t panic! We have many lenders who offer car loans to people with poor or no credit history. 

Our team members are here to help you apply for car finance, for most financial circumstances considered. Get in touch and discover what rates could be offered to you!

Can I Get A Brand New Car With Bad Credit?

Absolutely!

It will usually cost you more money to finance a newer car. But the differences between getting a new and used car finance are small. If you can prove you can afford repayments, you will have a higher chance of getting car finance.

To Finish

Thinking about getting poor credit car finance? It can seem intimidating. However, with some research and preparation, it’s not as difficult as you might think. Before you get in contact with our team members, we recommend you get your finances in order.

You can ask our team members any questions you may have about car finance when you apply through Bad Credit Motor Finance. They have a great deal of information they could share with you to help you make your decision. Plus, they could guide you step-by-step through the application process to give you the best deal possible.

Get a quote from us to see what you could be offered!