How to Get Car Finance with Poor Credit

How to Get Car Finance with Poor Credit

Finding out that you have a bad credit rating when you are looking to buy a car on finance is a horrible feeling, but it’s certainly no reason to not try! There are a variety of ways that you can make it easier for yourself to get accepted for car finance if you have poor credit.

Increase Your Deposit

You are usually asked to put down a deposit for finance deal, which tends to be around 10 per cent of the vehicle’s full price. If you put down more money to secure the deal, the lender is likely to see you as more cooperative and have more faith in your ability to make the repayments and they may potentially offer you a better interest rate.

Explore Your Options

If you have a bad credit rating, you may be refused for the finance scheme you are originally interested in, but there is also a good chance that you will be accepted for another. For example, you may not be able to get an unsecured personal loan or a PCP deal, but you could still be accepted for an HP plan. The key is perserverance!

If you are unsure of which scheme is best for you, speak to Smile, we have plenty of experience with bad-credit car finance so we can help you explore your options.

Improve Your Credit Rating

Without a doubt, the best way to increase your chances of being approved for car finance is to improve your credit score. This is not always the quickest method, but there are a number of ways to improve your rating and therefore your chances of being accepted for finance:

·         Pay off any outstanding loans or credit card debt.

·         Make a joint application with someone you can trust who has a good credit rating and make sure you have no joint accounts with someone with a poor credit score, as this could drag your own rating down.

·         Pay your bills on time.

·         Avoid making too many applications for finance – numerous full searches could deter lenders.

Remember, if it Sounds Too Good to be True, it Probably is

A number of companies will claim to offer ‘guaranteed finance’, but this will probably mean paying extortionate interest rates. You may think that you cannot be too picky, given your circumstances, but there will still be decent deals around so don’t feel like you have to take the first offer given to you because you haven’t even been accepted by some other lenders.

Unfortunately, there are companies who will take advantage of your situation, so to avoid overpaying, you should shop around, or let us do the leg work for you! At Smile Car Finance, not only will we consider you no matter what your credit score, but we will also scour the most competitive rates on the market to secure a fair deal.