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What Credit Score Do I Need For Car Finance?
27 April 2023

What Credit Score Do I Need For Car Finance?

Credit history can have a big impact on approval car finance, and if you are looking to finance a car, you may be wondering just how good your credit score needs to be.

Unfortunately, there is no easy, definitive answer as there are a lot of factors involved, including which lender you apply with, the price of the vehicle and the available evidence of your ability to afford the repayments.

Is there a minimum credit score needed to finance a car in the UK?

When it comes to applying for car finance, there is no specific minimum credit score that will guarantee acceptance. However, having a good credit score increases your chances of getting approved for car finance and being offered more competitive rates of interest.

Lenders have their own eligibility criteria, and your credit score may carry varying levels of importance to different lenders. So, there’s no universal score sought by finance providers.

Having a high credit score is always beneficial but if your credit score is low across the three prominent credit reference agencies in Britain (Experian, Equifax and TransUnion), you may find it more challenging to obtain car finance approval.

needed to finance a car

It is worth noting that each lender will assess your application differently, and your credit score is just one of many factors that will be considered but there are steps you can take to improve your credit score and increase your chance of approval across the board.

 

Ways to improve your credit rating

Improving your credit score requires effort and dedication, but these useful tips can help you to boost your score quickly:

  • Register to vote: This helps lenders to verify your identity, and being registered on the electoral roll positively impacts your credit score.
  • Include your name on bills: This way, your repayments are reflected in your credit report, indicating your ability to manage regular payments.
  • Set up direct debit payments: This is an efficient way to ensure timely payments, reducing the risk of missed or late payments.
  • Pay off debts as soon as possible: Using any savings or spare income to clear your debt quickly can save you a significant amount of money on interest payments while improving your credit utilisation rate, indicating responsible money management.
  • Join the Rental Exchange Initiative: This initiative highlights your prompt rental payments to lenders, further showcasing your creditworthiness.

 

Bad credit car finance specialists

A bad credit car finance specialist is a type of lender that specifically works with individuals who have poor or bad credit scores. These lenders understand that individuals with a low credit score may have difficulty obtaining traditional car finance from mainstream lenders and offer targeted finance options designed for those who have a history of missed payments, defaults, CCJs, or bankruptcies. 

Autozone/Car Credit Now is partnered with several lenders specialising in finance for those with poor credit to give our customers the best chance of approval!

While credit rating is an important factor in a car finance application, it is not the be-all and end-all. There are other things that finance providers will consider in their decision of whether or not to approve an application. Click the link below to find out more.