buying a car with poor credit rating

Can I buy a car with a poor credit score?

Yes! You can buy a car with a with a poor credit score, but you may have to pay a higher APR or need a family member or friend to be your Guarantor

Do you have a Poor credit score?

The best place to check your credit rating is with someone like Equifax Credit Reference Agency.

A Poor credit score will usually indicate a history of:

  • Missing repayments.
  • Defaulting on your loans.
  • Or a CCJ against your name.

You can buy a car with a poor credit score (in your name), but the cost of the borrowing will be higher.

How to get car finance with a poor credit score

If you’re reading, be assured there are many young drivers (and not so young) with a Poor credit rating and several car finance companies offer loans to such drivers.

Choosing a car finance company that initially does a “Soft Search” is important to help protect your credit score.

Providing you can meet the following criteria you could get car finance:

  • Aged 18+
  • A credit score of between 225 and 350 (a Poor credit rating on the Equifax chart).
  • A minimum monthly income of £750.
  • 12 Month employment history.
  • And, you must be registered on the electrol role at your current address.

What if you’re declined due to a Poor credit rating?

You can still buy a car with a poor credit score but would need to get a Guarantor car loan.

A Guarantor car loan will be more expensive, and you will require someone to guarantee the repayments.

What if you have not applied for credit before?

When you apply for credit first time, you will start with a Low credit score.

Getting a good credit history is something you have to build up over time, so things like getting finance to buy a car might not be as easy as you would hope.

If your credit rating is not sufficient to take out car finance on your own, you could apply for Guarantor car finance.

How do you improve a bad credit rating?

There are some very simple ways to improve your credit rating for car finance.

  • Apply for your credit report; to find out the information held on your credit file before you make any application for credit.
  • If you have already had an application declined a Credit Report would also help you to establish. Why?
  • If your name is not on the electoral roll at your current address, you won’t get credit!
  • If you get declined for credit! Don’t make repeated applications but establish why your application was declined before making further applications.
  • When applying for credit! Only make complete and accurate applications. Inaccuracies or omissions may affect you getting credit.
  • When you get credit! Make the payments on time to build a good credit history.

Are you on the Electoral Role?

You won’t get credit if your name is not on the electoral roll at your current address. (A credit report will confirm if you are on the register).

Get on the Gov.UK Electoral Register here.

A Soft search is best for your credit file?

When you apply for credit, the Lender will either make a Soft or Hard search on your credit file. Ask the Lender what type of credit file search they will carry out.

A Soft search on your credit file is not visible to other lenders so if declined it won’t show in your credit file.

A Hard search will go on your credit report and to regularly be applying and getting a refusal for credit will affect your credit score.

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Car finance

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