How to get approved for Car Finance with Bad Credit
Worried that your credit rating will affect your ability to get approved for car finance? Don’t worry, you are not alone.
Whilst it can feel an uphill struggle to get a car finance loan with bad credit, the great news is that it’s not impossible. Having a good credit score does indeed give you a few more options when looking for a deal, but for those with bad credit, it’s still possible.
Despite what you may have heard, there isn’t a minimum credit rating needed to get approved for car finance. This means those with a fair to poor rating can still get the finance they need to get behind the wheels of a new car.
At Motorly, we are experts on Bad Credit Car Finance, assisting UK motorists to navigate the car finance landscape to find the right solution for them. Read on to find our top tips to help you get approved.
What to do before you apply for car finance
Your credit score is a prime factor that lenders take into account when deciding to approve you for a car finance loan.
Even thought having a bad credit rating can limit the options available to you, it is still possible to obtain the car finance loan you need.
Check your credit score today and see if you can improve it.
Checking your credit score is always a great idea, especially when you are considering taking on a new finance agreement. If you do check your credit score, it is possible to make changes and potentially increase your credit score. Improving your credit score may help you get approved for car finance on better terms and a lower rate of interest. A few ways to improve your score include:
Reduce debts as much as possible
Reducing your credit utilisation (the amount of credit you are currently using versus the total level of credit currently available to you) can help improve your credit score. Reducing your credit utilisation to below 30% can help you get approved for more affordable rates.
Ensure all bills are paid on time
A great payment history will increase your credit score. Ensure all bills are paid on time. Make sure no accounts have been left in arrears.
Decide how much you can afford the monthly payments to be
When looking to buy a new car, it’s vital that you consider how much the monthly repayments will be. This will factor into what car will be suitable for you. You don’t want to find the ideal car only to find out the payments are too high for your budget.
Also, don’t forget to factor in other costs such as tax, insurance, and maintenance charges.
Get pre-approved for car finance
Not sure if your car finance application will be accepted? If you’ve got a poor credit rating the best course of action is to get a pre-approval before shopping for cars. By ensuring that you can get a car finance loan, you can walk into the showroom with your finance already in place – no need to worry if you will be accepted for your dream car
Motorly are the Bad Credit Car Finance experts and can help you every step of the way to get approved.