There are several factors that lenders consider when deciding whether to approve a car finance application, including credit history, income, employment status, and debt-to-income ratio. If you have bad credit, it may be more difficult to get approved for car finance because lenders view you as a higher risk borrower.
However, there are several steps you can take to improve your chances of getting approved for car finance with bad credit. Here are a few tips:
Before applying for car finance, it’s important to check your credit report to see where you stand. You can get a free copy of your credit report from each of the major credit bureaus (Equifax, Experian, and TransUnion) once a year. Review your report carefully for any errors or inaccuracies, and if you find any, dispute them with the credit bureau.
If you have bad credit, you may be able to improve your chances of getting approved for car finance by having a partner/parent co-sign your loan. A joint hirer is someone who lives at the same address, and agrees to take on the responsibility of repaying the loan if you are unable to.
Lenders are more likely to approve a car finance application if you have a larger deposit. If you have bad credit, it may be beneficial to save up for a larger deposit before applying for car finance. This way, you’re also borrowing less so the total amount you repay in interest will be lower.
If you have bad credit, you may want to consider choosing a cheaper car. Lenders are more likely to approve a car finance application for a less expensive car because the loan amount is lower.
It’s important to shop around and compare car finance options from different lenders. Some lenders specialise in bad credit car finance and may be more willing to approve your application. However, be aware that these lenders may charge higher interest rates.
At the end of the day, it is possible to get car finance with bad credit. However, it’s important to be realistic about your options and understand that you may have to pay higher interest rates. It’s also important to make sure that you can afford the repayments before applying for car finance.
If you are interested in applying for car finance, you can Apply Now or even take a look at Our Cars to see if you can find the right fit for your needs. If we can get you approved and therefore can get car finance with bad credit, we will then try to get you the best deal from our range of UK based lenders.
We stock a range of makes and models of cars between £5,000 and £15,000, so have something to suit most peoples needs. You can see our cars, updates, and find more information about how to get car finance with bad credit on our Facebook Page
