Car Finance for Bad Credit: What Are Your Options?

If you have a poor credit score, you might think getting car finance is impossible—but that’s not the case. At carloans 365, we specialise in helping people with a wide range of credit histories, including bad credit, find finance solutions that work for them. This guide explores your options and how to improve your chances of approval.

1. What Does "Bad Credit" Mean?

Bad credit usually refers to a low credit score, which could be the result of:

• Missed loan or credit card payments
• Defaults or CCJs (County Court Judgements)
• Previous bankruptcies or IVAs (Individual Voluntary Arrangements)
• Limited or no credit history

While this can make some lenders cautious, it doesn’t mean you’re out of options.

2. Types of Car Finance Available for Bad Credit

2.1 Hire Purchase (HP)

HP is often more accessible for those with bad credit, as the car acts as security for the loan. You make fixed monthly payments, and you own the car outright once the agreement ends.

2.2 Guarantor Car Finance

This involves a family member or friend agreeing to make repayments if you can’t. It reduces risk for the lender, which can increase your chances of approval.

2.3 Personal Contract Purchase (PCP)

PCP may be available to some applicants with bad credit, though not all lenders offer this option. Approval will depend on your specific circumstances.

2.4 Subprime Lenders

Some lenders specialise in bad credit car finance and are more flexible when assessing applications. At carloans 365, we work with a wide panel of lenders, including those open to applicants with adverse credit.

3. Tips to Improve Your Chances of Approval

Even if your credit isn’t perfect, there are ways to boost your chances:

• Check your credit report for errors and correct them.
• Register on the electoral roll to confirm your address.
• Pay off any outstanding debts where possible.
• Consider a larger deposit to reduce the lender’s risk.

Choose a realistic car that fits your budget.

4. Can You Afford the Payments?

Lenders will assess your affordability as well as your credit score. Make sure to:

• Budget for monthly payments.
• Factor in insurance, fuel, maintenance, and tax.
• Avoid overstretching your finances.

At carloans 365, we’ll work with you to ensure the finance deal is not just approved but also sustainable in the long run.

5. How carloans 365 Can Help

We understand that life doesn’t always go to plan. Whether your credit score has taken a hit due to unexpected bills or past financial struggles, we believe everyone deserves access to fair and flexible car finance.

Our team will:

• Match you with the most suitable lenders.
• Offer guidance on improving your application.
• Help you understand your finance agreement clearly.

In Conclusion

Having bad credit doesn’t mean you can’t get a car on finance. With the right support and lender, you could be driving away in your new car sooner than you think.

carloans 365 is here to help you every step of the way. Apply online today and explore your options with a team that understands your needs.