Financing a vehicle is often a top choice for those on the market looking for a new car, as it makes driving a new vehicle much more affordable. With a bad credit score, however, it can seem like an impossible task, particularly if there is no access to bad credit finance for your chosen vehicle.
Improve Your Credit Score
If you are unable to find a bad credit car finance option for your chosen car, there are small but significant steps that you can take to better your financial situation and improve your acceptance rate for other loan types. A beneficial approach to begin with would be to start paying off outstanding debts and bettering your credit score. With many companies using your credit score as a clear indication of your money management skills, improving this before applying for car finance will increase your chances of being accepted.
Opt For A Guarantor Loan
If you are not in a position to begin bettering your financial situation at this time but are in need of a car, there are loan types such as Guarantor loans that can prove valuable. When applying for a guarantor loan you are providing the lender with a designated person who will take over the loan payments if you are not able to meet the repayments. Both you and the guarantor will need to be credit-checked before being accepted to ensure that both parties can meet the monthly repayments.
Consider Other Loan Types
If you have been able to better your financial status, however, several other car financing options may be better suited to you when it comes to meeting monthly repayments. With available alternatives such as hire purchase agreements, personal loans and personal contract purchases, there are a variety of loan options that could fit your needs. By looking into each of these loan types, you will then be able to find an agreement that works for you, without running the risk of missing monthly repayments. Though it can take time to find the right loan type for you, meeting the monthly repayments can help to strengthen your credit score as a whole.
Finance A Second-Hand Car
Another viable option to allow to you to gain access to a reliable car, without a bad credit loan, is to begin saving. By putting away a small amount per month, you are then able to work towards saving for your vehicle finance option of your choice, whilst paying off any outstanding debt. Alternatively, there is the option to finance a second-hand vehicle. This can help to bring down the cost of the monthly repayments whilst providing you access to a reliable car that you can afford to run and insure.
Despite having poor credit, it is still possible to gain access to a reliable vehicle without breaking the bank. Whether you decide to finance a brand-new car or a second-hand option, there are plenty of companies that can provide you with a finance option suited to your financial needs.
