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Increase your chances of getting a car loan

Increase your chances of getting a car loan

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If you’ve already been refused car finance then you may think that getting accepted seems impossible. However, there are many ways in which you can get approved for car finance with bad credit and also a few ways in which you can increase your chances of getting approved.

How do you get approved for car finance?

Depending on your specific lender, there are a few things which you will need to provide to your car finance lender in order to get approved. No company can offer guaranteed car finance and you should be wary of anyone who says they can definitely get you approved! For many car finance lenders, you will need to meet the following criteria:

  • You are 18+ years old
  • You have lived in the UK for 3+ years
  •  You are not currently bankrupt
  • You can prove your affordability

Prove your affordability

Being able to prove your affordability is really important when it comes to car finance. Most lenders will require bank statements to check your income and make sure you can afford to meet your repayment schedule. If you’re applying for a self-employed car finance deal it can be harder to prove your affordability. If you do get paid cash in hand and never put it in the bank, then you should start before you apply for finance! If lenders check bank statements, they will never see that you have this money available to you. You could even put the money in the bank and then take it out to use as cash, just as long as you can prove that this money is available to you!

Use a car finance broker

You could consider using a car finance broker to help sort your finance for you. There are many bad credit car finance specialist brokers who work with a wide range of lenders. They can match you up with the lender that’s right for you and get you’re the best deal possible for your circumstances. You can then take your finance deal to any FCA approved car dealership to get the car you want within your budget – it really is that easy!

Increase your credit score

There are many ways in which you can easily increase your credit score and there are some which you may not have heard of before!

Make all your payments on time and in full

One of the best ways to improve your credit score is to show good lending practice. This means any current finance or loans you have; you should make your repayments on time and in full. Just making the minimum payment on your credit card each month can negatively affect your credit score.

Consider a credit building card

If you don’t already have any active credit to you could consider a credit building card. Just make a few purchases on it every month and then pay it back in full and you can see your credit score increasing!

Register on the UK electoral roll

In the UK the electoral roll is a list of names and address of people in the UK who are registered to vote. Even if you don’t care about voting in UK elections, it doesn’t mean that you have to. But it does mean that it can make it easier for lenders to verify that you are who you say you are and also can speed up the approval process.

Fix any mistakes on your credit file

You may be well aware that you have bad credit, but have you checked what is recorded on your credit file? You should make sure that all your information is correct and up to date. If not, it could be negatively affecting your score. You can fix any mistakes on your credit file by contacting your credit referencing agency who provided your credit report.

This is a collaborative post.

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