Get Car Finance for Subprime or Poor Credit
If you have a history of bad credit, it can be hard to get the finance you need towards a car, van or bike of your choice.
At Quiddi Compare, we work with a panel of lenders that offer a variety of car finance deals and are willing to accept all kinds of credit.
We understand that people can fall behind on payments and this can leave them with a less than perfect credit score. But personal and financial circumstances can change and if you have a good job, income and can afford a deposit, there is no reason why you cannot receive the car finance you need for a new set of wheels.
The lenders we feature offers deals to accommodate:
- IVAs If you have an IVA at the moment, you must check with your IVA company before applying as you may require their written consent.
Guaranteed Car Finance
There is no such thing as guaranteed car finance because providers will never lend money to people who cannot afford to repay as it puts both parties under strain. However, if you have poor credit, there are still ways to get a car loan including:
Making A Deposit
For a hire purchase agreement (HP), borrowers will be required to put down a deposit of at least 10% and then continue to make fixed monthly payments during the loan term of typically up to 5 years.
As this is a secured loan, the lender can repossess the vehicle if the customer does not keep up with repayments. This accommodates those looking to obtain poor credit car finance because the provider can always recover the vehicle and its costs.
With a personal contract purchase (PCP), a smaller deposit is needed initially and this is followed by little monthly payments and one big balloon payment at the end of the loan term.
This can work well for those with bad credit as there are small costs involved initially and it allows the customer to save up until the end of the car loan where they can repay in full or give the car back.
Part Exchanging Your Vehicle
If you currently have a vehicle that is worth something, you can part exchange this with one of our featured companies and put it towards financing a new vehicle. So whilst you may have a poor credit score, you can unlock the value in your vehicle to finance the car that you have your eyes on.
This is an agreement whereby the credit can be in a close family member’s name but the payments can be made from your direct debit account and you will be able to drive the car legally.
So for someone looking for car finance for bad credit, you are benefiting from the credit score of a close relative and can access the money you need through their trust and close relationship.
Consider making a joint application with a spouse, partner or someone at your address with a good credit score e.g housemate If you apply together, you will be able to ‘piggy back’ off their strong credit score and how they have a good record of paying loans in the past.
By living at the same address, it proves that you have a close relationship and the lender feels more confident above recovering their funds.
Will Applying Affect My Credit Score?
When you make your application, the lender will carry out a credit check using a credit reference agency such as Equifax or Experian.
Every application will trigger a ‘soft search’ or ‘hard search’ on your credit file with some lenders conducting multiple searches at once. A soft search is removed instantly but a hard search can take up to a year to be removed from your file.
By having too many hard searches on your account in a short space of time, it can make you seem in desperate need of finance and this can be off-putting for some lenders. Therefore it is recommended to limit the number of applications you make to protect your credit score.
Car Finance Can Improve Your Credit Rating
If you have poor credit, car finance can actually improve your credit rating. If you car loan has been approved and you get into the routine of regularly making monthly repayments on time, this information will be sent back to the credit reference agencies and it will cause your credit score to improve.
How To Apply
Use our free comparison tool above to find the best lender for you. You can compare the rates offered, loan amount and duration and then simply click on the lender of your choice and you will be taken directly to their website where you can apply.
We offer a completely free service and to keep it free, we may take a commission from the companies that we feature. We will not pass on your details to any other companies without your permission and all information is kept safe on our secure server.
To be eligible for bad credit car loan with our featured lenders, you must be over 18 years of age, UK resident, having a working debit account and be able to provide a copy of your driving license, proof of income and address.
All applications are processed online and upon completion, you will receive an instant decision. Once you have completed further checks, provided the relevant information and signed the loan agreement, the funds can typically be transferred to your account on the same day.