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Car Financing for Bad Credit Borrowers

by | Dec 11, 2020 | Car Finance | 0 comments

Car Financing for Bad Credit Borrowers

Need help with car financing for bad credit borrowers? Customers that come to us have been rejected with their car financing application somewhere else. This is why many of them often breathe a sigh of relief when they realize that they won’t necessarily have to experience the same fate in life with us.


We have a friendly team that will be thrilled happy to assist you. More importantly, we understand that not everybody gets to keep a spotless credit history with their financial circumstances being different. Your application for car financing is not going to affect your credit rating. In most cases, we accommodate all types of borrowers, even the ones with poor credit ratings.


Check out our car financing calculator

To give you an idea of how much the loan repayments are going to be, you can use the car financing calculator we provide. All you need to do is select how much you are borrowing along with the length of time you’d prefer to pay it back. We specialize in bad credit car financing.


Car financing repayments example:

If you intend to borrow £7500 and want to get it paid off in 4 years and your annual interest rate is fixed at 27.9% without any deposit involved, you will need to make a monthly repayment of £244.77. This will then bring the total credit cost to $4,248.96. Add that to the principal $7500. Then your overall payable amount is $11,748.97.


Note that this is only a representation of what you will likely need to cover when taking our car financing. Your individual circumstances tend to offer so you will likely end up paying figures that are way different than this example.


Note that at Simply, we’re brokers, not lenders.


We work with a wide array of lenders which gives us the chance to look into a variety of car financing applications from a diverse set of applicants with their own unique financial circumstances. If you’ve made financial decisions in the past that led to a bad credit score, you are a young driver or you’re self-employed, we may be able to offer you a helping hand.


Al you need to do is access the finance calculator on this page to get an idea of how much your monthly repayments are likely going to be for your preferred amount and repayment term.


Bad credit car finance— What is it?

For people looking to own a car, specialized loans are available these days that aim to offer financing assistance to those with poor credit ratings or borrowers with a spotty credit or bad credit history— those that are likely going to be turned down if they go the traditional lending route.


These types of loans ensure that even borrowers with bad credit records can still get access to the financing they need when they wish to buy a car.


Bad credit— What does it mean?

Bad credit can be a result of a number of things. In most cases, this may have to do with you failing to meet the conditions set by a credit agreement you have entered into.


If you have taken out a house loan and you fail to get the mortgage repaid, then this will reflect badly on your credit records. The same is true when you fail to meet the conditions set by a credit or loan arrangement. Financial missteps like these can lead to a blemished credit record or bad credit, which then leads to a damaged credit score.


When your credit score is bad, it will be more difficult to sign up for a loan for car credit. This means that future purchases where you will normally need some financing assistance like buying a car, motorcycle or van will be a little more than challenging because lenders will now have second thoughts over letting you borrow money, seeing that your credit record reflect how you have behaved in a less than ideal manner when you took out credit the past.


How can we help you with car finance?

At Simply, we are committed to offering bad credit borrowers the chance to secure car financing. This means that borrowers hoping to purchase a car will get the chance to secure financing, especially when they have been turned down several times by other lenders elsewhere.


Getting refused credit is a reality that every borrower has to deal with. Even a good credit rating is not enough to assure that you will get a thumbs up from the lenders, However, when you have bad credit, the likelihood of you getting refused will increase tremendously, and when you need to purchase a car for your daily travel needs, getting a car financing refusal makes the whole experience even more shattering.


It’s also a fact that many of the people who get turned down for a credit application are actually trustworthy and responsible borrowers who just happened to stumble financially in the past. In most cases, they will not only have the intention to pay back what they intend to borrow but they will have the means to do so too.


We can help you when others will turn you down

It’s quite easy to get disheartened over a car financing application rejection simply because of your credit score.


In most cases you being in this situation may not entirely even your fault. For instance, you could be self-employed or you may just be a first-time borrower and have not had the chance to establish a credit history at all.


Also, it could be that you have just had a bit of a struggle with paying your bills before which led to some late payments.


We offer car financing choices for all borrowers no matter their credit ratings

Luckily, at Simply, we have the means to help borrowers apply no matter what kind of credit history they have behind them. Even people with likely problematic credit records can still expect help from us including those borrowers with the following concerns:


  • Bad credit
  • Low credit scores
  • Defaults or CCJs
  • Poor credit
  • No credit history
  • Self-employed
  • Discharged bankruptcy
  • IVAs


How do I get approved for bad credit car financing?

If your credit score is less than impressive, a good way of upping the chance of your car financing request to get the green light is to pay a deposit for the car you’re interested in.


This isn’t always the easiest thing to do. Oftentimes, you may have to build up a bit of savings for a few months before approaching a lender so you can at least have something substantial to offer as a deposit. Still, this is a great way of showing to the lenders that you can save money if the situation calls for it and that you’re more than happy to throw in your own money just so you can secure a vehicle.


In addition, putting in a deposit for a car purchase ensures that you will have to borrow less which can lead to lower borrowing costs.


What details do you need to provide us?

At Simply, we make it a point to offer an easy, fast and streamlined car financing application. We will take the time to search for financing options and make comparisons on your behalf. This ensures that we will not only find the right credit for your needs but also the ones that would be most affordable for you. We do the dirty work so you won’t have to go through the hassle yourself. This also means that your credit rating is not going to be affected in the process.


Here are the steps you need to go through when sending in an application:

Step 1: Application

To send in your application, just use our quick-access application form. Make sure to take note of the different sections on the form and accurately fill in your personal details and other financial information that you will be required such as your name, address, employer, and birthdate among others.


When you send in an application, a soft credit check will be carried out. This means that the application is not going to impact your credit score. This should give you full confidence when sending your application in.


Step 2: Secure approval

Decisions to applications sent to us are incredibly fast. In most cases, you can expect an outcome within just a few minutes. From this point in the application until you have to pay the car will be carried out quickly so there is no need for you to endure a long wait time.


Step 3: Buy the car from the right dealer

This is perhaps the best part of the whole financing application process. Not long after, you will be picking up the new car and driving away in it. We can also assist you get connected with quality leaderships that we have checked ahead of time to ensure that they will not only offer the best deals for the cars they sell but also are known for their great services and incredible aftercare. This is a large purchase so you need to make sure you’re dealing with the right people.


Car financing for bad credit borrowers— FAQs

What is bad credit car financing?

Bad credit car financing is intended for people who need financing in buying a car but have poor credit rating.


Despite having a poor or bad credit rating, these loans offer a higher possibility of getting approved since lenders will look beyond your credit score and consider a variety of other circumstances when approving your request.


Can I buy a car from any dealer?

Yes. You have the option to buy your car of choice, new or used, from any qualifying and reputable dealer.


If you find it challenging to find the ideal car, our sourcing teams can also help you locate the ideal car for your budget and your needs.


Also, if you wish to get the car delivered straight to your location, we can do that too.


Are credit checks carried out when I send in an application?

We will do a soft credit enquiry on your records and since it is not a hard credit check, it isn’t going to have any impact on your credit records. Soft credit assessments are not going to leave any footprint on your records.


Checks like these will help provide us with the details we need such as your proof of address and is a means to validate your income. The decision-making process will be based considerably on ensuring that you have the means to afford the costs involved if and when you are approved for the loan. When we decide on a car financing application, we don’t just consider your credit score but your various other financial circumstances as well.


Can I take out car financing if I’m self-employed?

We may be able to assist you with your car financing needs even when you are self-employed. If you have made sure to get your income banked, then it is more than possible for us to help you obtain financing.


Can I take out a car financing if I’m in Trust deed or IVA?

Yes, provided that it is still running satisfactorily. However, we do need to provide proof of authority from your respective administrator giving you the nod to secure financing. In most cases, this is just but a formality.


I’m in the Armed Forces, can I avail of car finance?


Applicants who are in the armed forces are more than welcome. At Simply, we take pride in our commitment to assist the financing needs of all service personnel.


What documents do you need me to provide you with?

We have designed our application process to require less paperwork from your end. Provided that you have been banking your income all this time, we can use our automated system to validate your details for you to avoid unnecessary hassle in the process.


To do this, just make sure to send us a copy of your driving license. To ensure that you will securely and safely upload this to our portal, we will be sending you a secure link.


We will then check to ensure that we have all the necessary details we require including your personal details such as your name, birthdate and your address.


Once this is done, full approval should be put in place and you’re all set to start shopping around for a dealership that carries the make and model of your dream car and had a session with them then proceed to getting car insurance.


I’m receiving irregular income, will I still need to provide proof?

If your income is irregular and our system is unable to properly validate it for you, be prepared to provide additional details concerning this matter especially if you are not employed. If you are self-employed, you may need to provide the tax return for last year or in most cases, you’ll be asked to provide bank statements for the last 90 days.


If you happen to be employed, you may be asked to provide at least 2 months of your payslips.


Is there a minimum amount I can take out for car financing?

It’s common for car financing lenders to offer a minimum loanable amount of £4000.


Is there a maximum amount you are allowed to borrow?

The loanable amount will generally be capped based on the affordability of the loan. We will check how much income you are getting and we will also take into account how much your day to day expenditures are going to be as well. This will give us a good idea of the maximum instalment amount that you can afford to pay back on a monthly basis.


After we have secured your full acceptance, we will then email the information to you.


Are there fees involved?

No, we do not charge any admin fees for taking out a car financing.


Can my part exchange be used as a deposit?

Yes. It may be possible for the dealer selling the car to offer this but to make sure that you are getting the best price, we will be more than happy to give you an idea of the recommended price for trading-in your car.


I found the car I want to buy, what do I do next?

Once you have finally pinpointed the specific car you want, just let us know so we can determine what the car’s recommended sales price is. We will then get you the repayment details along. We will also proceed with the vehicle’s HPI check.


If you’re quite happy with the details, we can then have the documents emailed to you and then get the car loan payout arranged.


Will I be the car owner at the end?

Yes. After you have completely paid off the repayments, you will then become the vehicle’s legal owner.

There is also an option, sometimes, to a purchase fee. This could vary but often, this will be within £10-$20. This is generally charged on the payment you make for your last month.


Another finance company rejected my application previously, can I still send in an application?

Yes. We generally approve most of the applications sent to us, provided that we can see that you are earning enough to afford the monthly repayments. We are committed to always finding the most suitable car financing that is well within your financial capacity.


Can I still apply when I’m on benefits?

Provided that you can prove to us that you have the means to afford the repayments for the loan, we will be more than happy to help. Some of our funders will also be happy to approve an application without requiring the customers to have some employment income.


Do you offer guaranteed car financing?

Nobody can really offer guaranteed approval for car financing or any financing for that matter. You need to prove first that you have the ability to afford the car loan before any self-respecting and legitimate lender will offer you one. In most cases, we have a variety of lending options that will be appropriate for your specific financial circumstances.


Note that you are under no obligation to accept any finance offer. So, it doesn’t hurt to take the chance to send in an application and see how we can potentially assist you.


Is a guarantor required?

Simply does not require you to present a guarantor for any of the loan products we offer. Why have a guarantor pay expensive rates when they can just take out a loan under their name with better APR?


Remember that at the end of the way, they will still be ultimately responsible for getting the loan repaid such as car loans.


Concerned over credit inquiries?

We will get things started with a soft credit check. This will allow us to glean how things currently are as far as your financial circumstances go.


You don’t have to worry though because while this may be visible to you, the enquiry isn’t going to be seen by other lenders.


Know too, that we will always try our best to find you the most suitable and affordable car financing arrangements.


Provided that you have been successful at keeping up with the repayments of your current debt levels, the state of your credit ratings shouldn’t matter that much, which increases the chances of you getting approved.


Improving your credit score— Some tips and tricks

How much the interest rate that will be attached to your loan is will be affected by your current credit rating. The same is true when it comes to your chances of securing car financing.


If you happen to have a not very impressive credit rating, it is still possible to secure car financing. You do have to expect that it is going to be considerably higher which can result in higher monthly payments as well.


This is why taking the time to work towards pulling your credit score up is always going to be worth your time. The higher your credit score is the better interest rates you’ll be offered.


What is a credit score?

A credit score is used by lenders to determine whether to approve your borrowing request or not. It gives them an idea of whether you will be a reliable borrower or not. Lenders will generally care how you behaved in the past when you took out a loan as this will give them an idea of what your repayment behaviour is going to be. Through your credit score, they can determine whether or not you may be a risky borrower or not.


Among the red flags they will be looking out for include missed payments, late payments, as well as bills that were unpaid.


Scoring a higher credit score is something every person should strive for since this will help improve their chances when borrowing money.


Know your credit score

If you’re interested in knowing what your credit score is, you can obtain the information from any credit reference bureau like TransUnion, Equifax or Experian.


You can sign up for a free trial for 30 days which should allow you to get access to your report on the web. Just see to it that you get the subscription cancelled before the free trial period is over to avoid having to pay for it.


You may also secure a statutory report which should cost you £2.  


When finding out what your credit score is, always take the time to review the listing and ensure that every entry is correct. If you find errors on the list, make sure to contact the credit reference agency and have them correct the issue. Also, if you have made a late repayment in the past but actually have a valid reason as to why it happened, it is also possible to include the reason in the statement, just make sure to explain it in 200 words and attach it to the report you are submitting.


This is also referred to as Notice of Correction. All you have to do is contact the credit agency and ask them to make the necessary corrections. This is always worth your effort since this can certainly make lenders look at you with a more forgiving light when they find the real reason behind, thus improving your chances at getting a thumbs up when applying for credit.


If you have had serious debt issues in the past, know that this can have a massive impact on your credit score. Among the worst red flags you can have on your report include bankruptcies and CCJs or Country Court Judgments.


Whilst having bad credit is not a good thing, the same is true when you do not have any credit at all. This can be a disadvantage for you as a borrower since there will be no past history for the lenders to look into to assess your borrowing behaviour.


Working on your score- credit

Thankfully, there are steps you can take which should help pull up your score- credit. For instance, start by making sure that you get your name registered on the electoral roll if you aren’t on it yet.


Avoid sending out tons of credit applications too, no matter the type. It doesn’t matter if it is a credit card or a loan, try to minimise such applications and focus on essential. This is because any credit application is going to leave footprints on your credit history and lenders can see this. If they see that your applications seemed to be spaced way too close to each other, they might see this as a sign that you are desperate for cash.


If you have currently been approved for some type of credit, see to it that you get the monthly repayments done on time. Avoid missing any of the payments too. A direct debit which will just automatically get your dues paid on a monthly basis is one way of ensuring that you will keep up with the payments.


Also, if you have any credit account that you’re not really using, make it a point to close it down.