Bad Credit Car Finance

Bad Credit Car Finance

  • No Deposit? No problem

  • Buy from any reputable dealer

Get a Quote Does Not Affect Your Credit Score Representative 21.4% APR
4.9 out of 5

No Obligation
No Fees
Bad Credit? No Problem!

Bad Credit Car Finance

Get a Quote Does Not Affect Your Credit Score

Representative 21.4% APR

Blue volkswagen golf car finance
Ford car leasing
4.9 out of 5

No Obligation
No Fees
Bad Credit? No Problem!

4 Years

48 monthly repayments


Best available rate 6.9%

Total cost of credit £1,069.12

Total repayment £8,569.12

48 monthly repayments


Best available rate 6.9%

Total cost of credit £1,069.12

Total repayment £8,569.12

Representative example:

Borrowing £6,500 over 48 months with a representative APR of 21.4%, an annual interest rate of 21.4% (Fixed) and a deposit of £0.00, the amount payable would be £196.24 per month, with a total cost of credit of £2,919.52 and a total amount payable of £9,419.52

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  • No fees
  • Get dedicated customer support
  • Get finance to match your budget
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  • Buy from any reputable dealer
  • Over 30 finance options

How ChooseMyCar can help customers with Bad Credit

As car finance specialists, we understand that it’s not always possible to have the perfect credit score, whether you’ve not taken out credit before, or have experienced credit problems in the past. Bad credit doesn’t have to mean you can’t buy a car. 

We know how difficult it can be to secure the right deal for bad credit car finance. That’s why we always go the extra mile to find the best deal for your individual circumstances. We’ll start by conducting a ‘soft search’ rather than a full credit check, so the initial application won’t affect your credit score. This will give us a clear indication on whether we can source credit for you and the kid of credit we can get. If what we initially offer seems right for you, only at this point, we will progress onto the full credit application. 

Here are just some of the other ways we can help:

CCJs, defaults and arrears icon

CCJs, defaults and arrears

Our network of trusted lenders can help you find finance, even if you have CCJs, arrears, IVAs or a debt management plan. It may be that you're self-employed. Whatever your situation, we could help you to secure car finance.

Applying won’t affect your credit score icon

Applying won’t affect your credit score

To work out the affordability of any loan, simply use our quick finance calculator to see what you could borrow. Or, apply now to view your options. All without affecting your credit score.

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Approved, reputable dealerships

All our trusted dealerships are handpicked by our experts. That means quality cars, from quality dealerships. So, you can feel safe in the knowledge that your experience will be smooth from beginning to end.

Representative 21.4% APR icon

Representative 21.4% APR

We’re always transparent with our finance deals. Plus, we always find you the best rate. For starters, our representative APR is just 21.4%. Because putting you first is what we do best.

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Applying with us only takes a couple of minutes and won't affect your credit score

I have bad credit and I'm worried that I won't be able to get car finance - what are my options?

If you have a poor credit rating due to missed payments or anything else, we understand just how of a worry it can be when looking for new finance arrangements. But having bad credit isn't going to stop you from needing to be on the road with your own personal transport - here at ChooseMyCar, we understand this. In fact, having a car might be crucial to continue earning and begin improving your credit rating. Fortunately, you've come to the right place. 

Whether you have a poor credit score, an IVA (Individual Voluntary Agreement), a CCJ, or if you have been refused car finance elsewhere, the friendly team of experts here at ChooseMyCar are here to help. We have years of experience helping to match customers with poor credit scores with manageable and affordable car finance across the country. Regardless of your financial situation, get in touch with us today for the guidance and advice you need.

The good news is that there are a few options open to you when it comes to your car finance application, even if you have bad credit. From taking steps to improve your credit rating and credit report, using a guarantor loan for added financial security, using our online car finance calculator to make sure of what you can afford, we will work alongside you as a finance company who will support and guide you through the process. Making a finance or loan application when you have bad credit can be daunting - we are here to help.

How do I get car finance when I have bad credit? 

 Some car finance lenders won't work with customers who have poor credit. Here at ChooseMyCar, however, we are finance specialists who can help you to get accepted for a manageable and affordable car finance agreement, even if you have a bad credit record - or even if you have no credit profile at all. Some of the first things that help when it comes to getting car finance with bad credit include: 

  • Proving that you can afford the repayments - Any car finance company or money lender wants reassurance that you will be able to keep up with your payments. Here at ChooseMyCar, we understand that individual circumstances can vary wildly. Even if you have bad credit, if you can prove that you have the monthly income to afford your repayments, this will greatly boost your chances of having your car finance application approved.
  • Having enough to offer a deposit - A deposit is a staple part of most hire purchase and personal contract purchase car finance agreements. We understand this isn't always easy if you have bad credit, but if you have the ability to offer a deposit your chances will increase your chances of securing a good finance offer. Not only this, but it will also help you to keep the rates of your finance agreement down, and bring down the total cost of the vehicle down too.
  • Consider using a guarantor loan for car finance - As we mentioned above, if you are someone with a poor credit rating and whose financial circumstances might make it difficult to secure good car finance, a guarantor car finance loan is a great way of offering your potential creditor added assurance and financial security. 

Fortunately there are some options available to you as someone with bad credit looking for a new car finance option. Here at ChooseMyCar, we have years of experience helping customers with poor credit files, IVAs, CCJs, and zero credit history apply to get car finance. But to understand what you can do to improve your chances, it's important to understand exactly what affects your credit score, and how this affects your ability to get car finance.

What exactly is a bad credit car finance deal? 

Simply put, a bad credit car finance deal is any car finance deal that a lender agrees to offer someone with a poor credit history. A car finance agreement when you have poor credit allows you to spread the total amount of buying the car over a fixed term and period of time, to be paid in monthly payments. Generally speaking, car finance is an excellent option for people with bad credit because it avoids the need to make a large upfront payment at the beginning - but, as touched upon above, you'll need to be able to prove that you can afford to keep up with your monthly payments.

Having bad credit isn't going to stop you from needing to get around - especially if you need a car to get to work to keep on earning. While some car finance companies avoid working with people with bad credit, the team at ChooseMyCar are experts in it. When you have poor credit, it can feel like a while range of finance applications are just going to be shot down after a credit check, closing doors to you and limiting your options.

Some car finance providers believe that poor financial history makes you unreliable to keep up with the potential repayments across the duration of your contract length. But we know that a chequered credit history doesn't mean you can't afford your repayments.

Bad credit car finance deals can work for people who are self employed, it can affect young drivers who have zero credit history, it can affect people with a CCJ (County Court Judgement), people on a debt management plan like an IVA (Individual Voluntary Arrangement), people who have missed payments in the past, and more. Some lenders will raise interest rates and take away no deposit options - but the ChooseMyCar team is here to help. 

How exactly does bad credit affect your car finance application?

It's important to understand the relationship between your credit score and your ability to make further full credit applications. Knowing that bad credit might have a negative impact on your ability to apply for new finance agreements is one thing, but why exactly is this so important to lenders?

Well, people can have bad credit for a number of reasons, but the most common reason is often having missed payments due to financial difficulties in the past. If you have fallen behind on your repayments for other credit agreements, this will negatively impact your credit score - which will be seen by any other potential lenders when they run a credit check.

Any lender wants to be assured that you will keep up with your monthly payments and that everything will be made on time. This is part of any lending criteria and a lender will look for missed or late payments as part of your credit file - and this might affect your ability to secure a car finance agreement.

Other things that can affect your credit rating and your ability to get car finance include having an IVA (Independent Voluntary Arrangement) - in which case any responsible lender will ask for written confirmation from your Insolvency Practitioner that you have been approved to borrow again. 

What is my credit score, what affects it and how can I improve it?

Your credit score, or credit record, is essentially a history of your past behaviour when it comes to credit agreements. A lot of things can affect your credit score, such as taking on a lot of new credit, the length of your credit history, your mix of credit arrangements and more. However, payment history is the most important part of determining your credit score and it has a very significant impact on your credit profile overall. Lenders are most interested in knowing whether you will be able to keep up with monthly payments and make your payments on time.

As such, a bad credit score is most often the result of failing to adhere to prior credit agreement such as missing payments or making late payments. For example, if you have failed to repay a mortgage, missed payments on a mobile phone deal, failed to repay a loan, credit or prior finance agreement, then you are very much at risk of damaging your credit score.

Having a bad credit score will in general make it more difficult to have future credit deals approved and to secure funds for purchases such as those for a home, car, or other vehicle. Your credit score affects how a lender views your eligibility when deciding things such as: 

  • Whether to lend you any money at all
  • How much money to lend to you
  • What interest rate should be set on the amount that is loaned to you

Think of your credit score, credit report and credit history as something like your very own financial footprint. It behaves like a record of your financial history with other creditors that allows potential future lenders to assess how safe it is to offer you finance or credit. If you have missed payments, made late payments, or been declared bankrupt, then your credit history will reflect this.

The good news is that you are able to make your own eligibility check by checking your credit score with a credit reference agency - and this is often done entirely for free. It's important to understand that having bad credit won't necessarily stop you from undergoing your own car finance journey, but it may make the process more expensive and long winded.

What affects my credit score?

Your credit score is exactly how potential lenders will determine how eligible you are for certain loans such as credit cards, mortgages and more. When it comes to the car finance process, it's important to know that potential lenders will always run some form of credit check at first. There are a lot of different things that can affect your credit score, including: 

  •  Your current financial situation regarding debts
  • Your current credit availability, alongside how much of this you are using as active credit
  • Your history of making credit payments and repayments
  • Your credit searches
  • Your presence on the electoral role

If you have a good credit score, then this shows that you are more likely to keep up with your car finance repayments without missing monthly instalments. As such, ideal lenders are more likely to offer you to offer a car finance deal with more manageable full monthly payments at a preferential rate.

So how do I improve my credit rating to make it easier to get a good car finance agreement?

The first step in getting a good car finance bad credit deal is always to start taking steps to improve your credit score. Here at ChooseMyCar, our finance team specialises in providing manageable bad credit car finance agreements, but our financial advisors always recommend improving your credit score to help access better deals. Fortunately, there are a few things you can do to help this, including: 

  • Registering to vote - This is a simple one, making it an absolute must. Your prospective lender will always perform a credit check before making a lending decision. To do this, they'll need your name and address - something you can make much easier for them by registering on the electoral roll.
  • Identify and address any issues with your credit history - Our finance advisors always recommend regularly reviewing your credit score, as well as getting hold of your full credit history. Doing this means you can make sure that there are no mistakes while also taking steps to begin making repayments on any current credit you have.
  • Make your repayments on time - Making sure you don't miss any payments avoids accumulating current debt that reflects badly on your credit history. This demonstrates to your new lender that you are more likely to keep with payments on any used car finance deals they approve you for. Doing this will improve your credit score over time as well as helping you to secure more beneficial and affordable car finance deal.
  • Don't open too many new loans and close unused credit accounts - If you have a lot of new loans opened recently, your lender will be able to see this and might take it as an assumption of financial difficulty. Generally speaking, the more loan applications you make, the more likely it is that your credit score might decrease. On top of this, unused current credit accounts should be closed to clear this from your current history. 

Knowing you have bad credit can be stressful and it can potentially close doors to you when it comes to finance and loans. But knowing where to start on your journey of improving your credit score is also difficult. Fortunately, here at ChooseMyCar we have some fantastic resources on our website. Among these is our guide to improving your credit score, which is a great place to start for anyone hoping to apply for car finance with bad credit.

What steps do I need to take to apply for bad credit car finance?

When it comes to applying for car finance with bad credit here at ChooseMyCar, things couldn't be simpler. To apply for car finance with us today, all you need to do is to follow these simple steps: 

  1. Check to see what exactly you can afford - The first step in making your online application should be to check exactly what you can afford. We have a brilliant online car finance calculator available for you here at ChooseMyCar, which will give you a representative example based on the information you give us.
  2. Apply with us online - The next step is easy: simply apply with us online here at ChooseMyCar - whenever you want! It's a simple online application process.
  3. Get your quick decision - In a short space of time, you'll get a quick online decision about your approval for bad credit car finance. This can sometimes be the same day you apply!
  4. Find your perfect used car finance - Everybody has slightly different things that they need from their car. Here, you can browse our website to find the used car that fits your budget and needs.
  5. Agree to your finance repayments - Now it's time to actually buy your car from any car dealership. Your finance repayments and loan amount have been approved so you're ready to go ahead and buy your ideal car.
  6. Sort out your paperwork - Our dedicated and friendly team will give you all the guidance and assistance you need to complete all the necessary paperwork, allowing you to sign your agreement and officially put things to paper.
  7. Grab your keys and enjoy your new car - Well, this step is fairly straightforward! Everything has been sorted out and you are free to pick up the keys to your new car and hit the road! 

Are hire purchase (HP) agreements good for drivers with poor or bad credit?

You might have poor or bad credit for a wide range of different reasons, we understand that here at ChooseMyCar. You might be self employed, a young driver with no credit history, someone with an IVA or County Court Judgement, or you might be someone who has experienced bankruptcy in the past. Whatever the reason, hire purchase car finance agreements are very popular for people with poor credit.

With a hire purchase (HP) deal, the total cost of the car is divided into monthly repayments - and when the total amount repayable has been met, the car with officially belong to you. This is great for drivers hoping to own a car asset at the end of their car finance. There is often a small lump sum deposit to be made at the beginning, and you don't actually own the car until the final payment has been made.

Considering a personal contract purchase (PCP) agreement when you have bad credit?

For drivers with bad credit records, another popular option is the personal contract purchase (PCP) car finance deal. Similar to the hire purchase arrangement, in a personal contract purchase agreement, you pay monthly instalments, often make a small deposit at the beginning, and have the option to own the car at the end of the finance deal.

The biggest difference with between a hire purchase deal and a personal contract purchase agreement is that, with the PCP deal, you will need to pay a balloon payment at the end in order to own the car. This is a large optional final payment to transfer ownership of the car to you, or you can choose to give the car back or part exchange it. The fact that this large optional final payment is part of the PCP deal means that your monthly repayments are often lower than those made in a hire purchase deal. 

Consider using a guarantor loan for car finance when you have bad credit

Rates can often be higher than representative models, but there are still deals to be found. One finance option for people with bad credit records is the guarantor loan, which allows you to prove more financial stability and security to your potential finance provider. A guarantor loan allows you to use someone else, such as a friend or family member, as a guarantor.

In most situations, you guarantor won't need to become involved other than simply filling in the paperwork at the start. However, they are there in order to help you to avoid the higher interest rates that your poor credit score would otherwise leave you with. A guarantor means that if you miss one of your monthly payments, they will step in and pay it for you. This is a great way of securing a new credit agreement whether you have a bad credit profile, an IVA, a CCJ, have no credit history or anything else.

A couple of things to bear in mind is that you cannot use a spouse or someone who is financially connected to you as a guarantor, and if both you and your guarantor miss a payment it will negatively impact both your credit scores - and you could each face legal action. 

Soft Search vs Hard Search

When applying for credit, there are two different search methods that you are likely to be subject to - these are categorised as soft searches and hard searches. Each method is slightly different but has the same end goal, which is determining whether you are eligible to be granted credit based on your credit history. Whilst many people do not take the time to research the difference between the two searches, it’s incredibly important that you do take the time to understand the subtle differences, particularly if you have bad credit or no credit history. Below you can find a summary of the two different search types you may go through during a credit check, with the major factors and differences outlined.

Soft Search

The major thing to bear in mind with a soft search is that it does not leave a mark on your credit history as a hard search does when it is carried out - this means that future searches are not able to detect a recent soft search. This helps you to maintain a higher credit score, as multiple credit searches on the same file in quick succession is a major red flag for most CRAs. 

A soft search tends to feature less detail than a hard search would; it gives an outline of the applicant’s credit history rather than an in-depth look into every event present on the report. A soft search will give the lender a glimpse into your credit history, giving them a rough idea of your experience with credit and how you managed your repayments. Soft searches are the most common form of a credit check and are completed routinely at points you may not even realise, such as:

  • Applying for a new job
  • During a tenancy agreement
  • When using price comparison tools to browse insurance policies

This may sound alarming, but there’s nothing to worry about; as these searches do not show on your credit report, you do not need to limit how frequently they are carried out. 

A hard search is usually performed in the next stage of your credit arrangements when you have been deemed eligible to apply for credit - this search is far more rigorous and detailed, and is more likely to highlight issues or negative points that appear on your credit file. You will be subject to a hard search when you apply for car finance, make a loan application, or apply for a credit card - these are circumstances where the lender needs a clear picture of your credit history to assess whether you should be granted access to credit funds.

Unlike soft checks which can often happen without your knowledge, you must be informed when a hard search is being carried out on your account. This is because these hard searches can impact your credit score and will leave behind a mark to say that the search has been performed on the account.

Get in touch

Want to find out more about how the dedicated and friendly team here at ChooseMyCar can help you to secure car finance with bad credit? We have a range of useful resources and guides online, including an excellent car finance calculator. When you're ready, simply apply with us online and we can help you to get the ball rolling! 

Frequently Asked Questions

While you won’t need a good credit score to flat out buy a car, it can affect things if you want to get car finance. Overall the better your credit rating the better deal you’ll get on your car finance.

A poorer credit score may mean you are either denied car finance altogether by some lenders or else face higher interest rates or monthly repayments. That shouldn’t put you off though, at ChooseMyCar we are experts in bad credit car finance and can even help people with CCJs or IVAs get car finance. For more information on raising your credit score, check out our guide.

It is possible to get car finance with bad credit. Many lenders provide loans and finance options specifically for people with bad credit.

Personal loans can be a great car finance option if you have bad credit. And a guarantor loan may help you avoid higher interest rates; this is where a friend or family member co-signs the loan, agreeing to meet payments if you're unable to.

With pre-approval on a personal loan, you can walk into the dealership like a cash buyer. You can be in a better position to negotiate on price. And you can avoid the stress of the finance office.

Your car finance may have been refused for a number of reasons. These are generally one of the following: 

  • Poor credit history or a bad credit score - read our tips on improving your credit score
  • You don’t meet the criteria for qualifying for that lender’s finance
  • Your employment status - some lenders won't approve you if you are unemployed or self employed
  • Type of driving license
  • Age - this could be because you're too old or a young driver. 

For more information on why you may have been declined, please read our guide on being refused car finance.

While it’s not ideal, there are circumstances that may occur that stop you from making a payment.

If you are unsure about your ability to make an upcoming payment we would recommend contacting your lender. This way there may be something that can be worked out before the payment is missed.

If you’ve already missed your payment, and can afford to make it, contact your lender as soon as possible to make the payment. You may incur a late fee, but making the payment can stop anything else from having.

If you continue to miss payments there is a chance your car could be repossessed and you will still owe for missed payments. Your credit rating will also be negatively affected.

Your credit file is checked if you apply for car finance. And you'll usually have to provide proof of ID, address, and income. The specific documents you'll need ultimately depend on the finance provider you go with.

Providers will check your credit score when you apply - initially via a soft search. They'll perform a hard credit check if you choose to enter into a contract with them. Most lenders will need to see your driving licence - full or provisional. You may also be asked to provide:

  • Your passport - for proof of ID
  • Utility bills or council tax letters - for proof of address. These usually need to be dated within the last three months.
  • Payslips - for proof of income and to make sure you can afford the payments. Some providers may ask to see a few months' worth.

The amount you can afford to spend on a car will vary depending on your situation. The important thing is to make sure you can afford any repayments that your car finance agreement sets out. Missing repayments can cause issues between you and your lender and could end up in court or affecting your credit rating. 

To work out what you can afford, try our car finance calculator.

If you make all of your payments on time on your car finance loan, then it should have a positive effect on your credit rating. This will prove to lenders that you are reliable and will reflect well on you.

However, if you miss or fall behind on repayments it will have a negative effect on your credit rating and remain in your credit history for 6 years.

For more information read our guide on credit scores.