Bad Credit Car Finance

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Representative 21.4% APR

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Bad Credit? No Problem!

£8,000
4 Years

48 monthly repayments

£356.94

Best available rate 6.9%

Total cost of credit £1,069.12

Total repayment £8,569.12

48 monthly repayments

£356.94

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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  • Get finance to match your budget
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  • 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, are reliant on no credit check, need help with debt management,  or perhaps you have even filed for bankruptcy. 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 of whether we can source credit for you and the kind of credit we can get. For example, you might be in need of a guarantor loan or a specific PCP (personal contract purchase) or HP (hire purchase) car finance option. 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.

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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 poor 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.


Your finance options if you have bad credit

If you’re looking for bad credit car finance, it’s likely that you fall into one of the common bad credit categories that typically make it more difficult to find car finance with most lenders - whilst this may seem like a hindrance, it doesn’t have to be. Here at ChooseMyCar, we’re experts when it comes to providing our customers with an affordable car finance package, even if they have bad credit. You can find more information on the types of bad credit car finance that we offer below:

A CCJ (County Court Judgment) 

The first type of car finance we offer for those with bad credit is CCJ car finance, which helps those with County Court Judgements to get back on the road despite their past financial troubles. Having a past or present CCJ can hurt your chances of being successful in credit applications, but it does not mean that you will be automatically refused car finance - there are lots of variables, with specialist bad credit car finance providers offering tailored plans that account for your specific problems. With the help of a bad credit car finance expert, you’ll be able to find a finance plan that works best for you, meaning you could be back on the road much sooner than you initially might have thought.

How will a CCJ impact my car finance application?

Once it has been issued, your CCJ will remain on your credit file for 6 years, meaning that it will continue to make it tough to gain access to car finance or other forms of credit for that period. A CCJ will remain on your file even after the debt it relates to has been paid off, which means there are likely to be long lasting repercussions if you are handed one. This is one of the things that will be taken into consideration when you are being considered for credit and often contributes to your score being lower than you would like it to be. 

This lower rating on your credit score becomes an issue when you are applying for new credit agreements, as it indicates that you have a history of failing to make payments on outstanding debts to the point where an official order had to be put in place for payments to be made. Whilst you may not fail a credit check solely down to your CCJ, a low credit rating will often result in the applicant being subjected to higher interest rates than those who have healthier scores might.


How can ChooseMyCar help?

Here at ChooseMyCar, we pride ourselves in being able to assist those in tougher circumstances with their car finance - we use a system that protects both the lender and the borrower, ensuring that payments can be made and unpayable debt is avoided. Get in touch with our team to find out how we can help you to get back on the road in a new vehicle using our bad credit car finance deals!


Finding a car under a debt management plan 

Much like the impact of a CCJ, the presence of a debt management plan can often hinder the availability of credit and car finance for many people. A debt management plan is something that is put in place for individuals who have particular trouble managing multiple debts, often to the point where multiple creditors are pushing for more authoritative action to be taken against the borrower. Debt management plans (DMPs) take the control of the debt away from the individual, with the debt instead being handled by an external handler who will determine how much money is given to each creditor that the indebted owes money to. Rather than directly paying the money to their creditors, the individual would pay a lump sum to a debt management plan provider, who will then disperse this money fairly, prioritising the most pressing debts to ensure that no further action is required. 

One of the steps that a DMP enforces is that you are not able to take out any more credit than what already exists on your account - this is to ensure that the amount that your debt is always reducing, never increasing. Whilst this may sound like car finance is out of the question, it doesn’t necessarily have to mean that. On the first glance, it does seem that car finance is adding further debt to your account, which is prohibited under a DMP, but it’s important that context and necessity are accounted for in this situation - even under a debt management plan, you may be granted the option to apply for car finance should it be deemed a possession that is entirely necessary to your circumstances. The rules around this can be quite strict, however, if you can prove that you need a car for specific reasons that are pivotal to the lives of yourself and your family, you will be able to apply for car finance.

There are a few criteria that are considered when trying to decide whether a car is a necessity for an individual that is under a debt management plan, which are as follows:

  • Are there any dependents who would suffer without a car? In many circumstances, the car is more than just a vehicle for the person that drives - it’s often the way that children get to school, the way that parents get to and from the shops, or the way that vulnerable family members are able to get to the places they need to go to safely and comfortably. If you can show that your car is needed for your children or vulnerable close family, a car may be seen as a necessary possession, meaning you will be able to apply for car finance despite your DMP. 
  • Are there adequate transport routes in your area? This factor will be looked at very closely, with only extreme cases being granted access to car finance due to a lack of transport routes. If you have any kind of transport to the local towns or cities within a reasonable distance of your home, it’s likely that you will not be granted access to car finance - this factor is only really applicable to extremely rural and remote areas where you need to travel great distances for work, shopping, school, or medical appointments and transport is not a feasible option.
  • Do you have any health issues? Individuals with health issues that make travel difficult may be allowed to apply for car finance to aid them with transport in certain situations. It’s likely that this will only be possible if your health issue has a direct impact on mobility, or if public transport is considered too high of a risk due to your health problems. 
  • How Long Is Your Commute To and From Work? Your commute to work is absolutely essential when under a debt management plan - it is your main source of income, which is used to pay off your debts, so it’s vital that you ensure you are able to get to work. Whilst many people may live close enough to commute to work using public transport, this isn’t always the case, so if you aren’t able to make it to work without a car, you may be allowed to make an application for car finance.

If you think that you meet the above criteria, you’ll need to discuss the possibility of applying for car finance - this request could still be rejected, however, given the extreme circumstances stated above you do stand a chance of being allowed to look for car finance deals that provide you with a reliable vehicle to aid your day to day needs.

Getting a vehicle after bankruptcy  

Another circumstance in which you may need to look for specialist bad credit car finance is bankruptcy, particularly as you’re coming out of bankruptcy and looking to start to get things back on track. One of the first things that you’ll want to arrange is a vehicle - it’s not just a useful possession, it’s something that enables you to do so much more, including start finding new job opportunities that aren’t accessible with public transport. As you can imagine, having a bankruptcy associated with your credit file will have a huge impact on your ability to apply for new credit arrangements, but it does not mean you won’t be able to. Instead, you may be best focusing your attention to finance providers such as ourselves here at ChooseMyCar, where we specialise in car finance packages that are tailored to help out those in particularly difficult financial situations such as those coming out of bankruptcy. 

When you are coming out of bankruptcy, your credit score is likely to be close to an all-time low, which can mean you have to be incredibly careful not to damage it further. This becomes even more difficult when you consider that you must carry out a credit check, which can have a negative impact on your credit score when applying for finance for things such as car payments or housing agreements. At ChooseMyCar, we follow a two-step credit check that allows you to see whether you may be eligible for our finance packages before you are submitted to a hard credit search - this means that you’re minimising the risk of a rejected application, which can be a red flag on your credit file. To get started with an application, simply follow the steps right here on our website - you could be holding the keys to your shiny new car in no time at all!

No deposit packages

When you’re looking to make your car finance plan as affordable as possible, there are a lot of different options to consider - you could look for a cheaper vehicle, you could choose to spread to cost over a longer period of time, or you could look for a no deposit car finance package! By removing the need to pay for a deposit, you won’t have to worry about bringing together a large lump sum at the start of your payment plan, you simply pay your monthly payment and that’s all you need to think about! For many, the need for a car is immediate, so it’s great to be able to get hold of a suitable, reliable vehicle quickly should you need one. This speedy service isn’t always possible when you need to build up the money for a deposit, so many choose packages such as our £0 deposit car finance schemes to get back on the road as soon as possible. 

One thing to be aware of when buying a car on a zero deposit finance plan is that the cost of the monthly payments will be higher - this is to account for the absence of the deposit which would usually be paid when entering such an arrangement.


How can I get a car finance deal? 

 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.

How is a car finance arrangement different when you have bad credit?

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 your bad credit affect your 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 record?

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.


Signs of bad credit

Without undergoing a formal credit check, it can be tough to know whether you have bad credit, but having a test carried out on your account can contribute to a poor score, so that has the potential to leave you in an incredibly sticky situation. If you’re wondering how you might be able to spot whether you have bad credit without undergoing a credit check, here are a few of the telltale signs to look out for:

Defaults on payments

One of the most obvious things to keep an eye out for is defaulting on your payments more than once - any default that is held against your account will have a negative impact on your score and will remain on your credit file for quite a while, which can often be a deterrent to potential lenders in the future. A default is awarded when payments on your current outstanding loans have not been made, resulting in falling behind with your debt and breaching your pre-agreed payment plan set out by the lender. If the default is cleared within a few days, there is a chance that your error will have been cleared before it could appear on your report, however, if it is left for a longer period of time then it will certainly leave a lasting impression. 

Loan application rejections

When you’ve got poor credit, you’re likely to find it hard to get credit, so this can also be a clear indication that your credit profile might not be in the best shape. If you’ve found that your recent loan, credit, or finance applications have been coming back with rejected responses, it’s highly likely that you are suffering from bad credit caused by mismanaged finances and unpaid arrears, and late payments. If this sounds like the situation you find yourself in, it could be time to look into ways that you can improve your credit score.

Credit card applications

Much like with loan applications, you will need to pass a fairly comprehensive credit evaluation in order to be offered a credit card - a credit card is essentially loaned money which must be repaid on time, or you’ll face default, debt and poor credit. People with bad credit may often find it difficult to find credit card providers who are willing to offer them a card, with the options that are available often relying on high interest rates and sub-par bonuses to minimise the risk on their behalf.

On top of this initial credit check during your application process, most card issuers will routinely conduct further checks throughout the time that you have a card, continuously monitoring any improvements or decreases in your creditworthiness to ensure that you are still an eligible recipient of the credit being offered, or if your credit limit could be increased due to improved credit ratings. If you notice a change in your credit limit or eligibility for credit cards, it’s highly likely that your credit score has changed.

Debt collection agencies

If your loans and credit lending has got out of control, you may be contacted by a debt collection agency - these are companies that are in place to ensure that debts are paid in one way or another, whether this is through threats of repossessing your assets or with them actually actioning this and sending bailiffs to collect items in the amount of your unpaid debt. The first thing you should do in the event of being contacted by a debt collection agency is to verify that the debt being collected is in fact tied to your account - if the accounts in question are genuine, you’ll then need to ensure that you are getting your payments up to speed as soon as possible to avoid further action including repossession. 

Job application failure

What many don’t know is that when you’re applying for a new job, you’re often submitted to some form of credit search, usually a soft search, which gives the employer the opportunity to take a closer look at their new potential employee. A person’s credit file is often a great indicator of how they manage their finances, which is particularly important for high ranking positions such as directors, executives, or finance staff. When you’re having trouble finding a new job, it’s worth considering whether your credit score could be impacting how appropriate you look for these roles to a potential employer. 

If you’d like to have a credit check carried out on your account, you always have the option to do so - there are regulations in place to ensure that every person is able to view their credit score for free, however, some services may charge a fee. These paid services can often be far more informative, giving a deeper insight into your finance and credit history to highlight how well you rank and where you could improve.


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

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! 

How to use our finance calculator


The ChooseMyCar finance calculator is a tool that you can use to try to work out exactly how much you might need to borrow in order to be able to pay for your car. The car finance calculator details how much of a deposit you may need to make on the car of your choice as well as giving you a general idea of the cost of the monthly payments. By using the tool, you’ll have a much clearer idea of whether you’ll be able to afford the car that you’ve chosen, as well as a better look at how your payment plan may play out.

Step 1

The first step you need to take is to decide how much money you will need to borrow - this will differ depending on the variables that you set, so you can work this to suit the finances that you have at your disposal. The amount you need to borrow will depend on the deposit that you put down - the bigger your deposit, the less money you’ll have to borrow so try to put as much down on the deposit as you can if you want to minimise your monthly payments. Alternatively, we offer £0 deposit deals, meaning you pay the full cost of the vehicle through monthly payments!

Step 2 

Once you’ve decided on the amount of money that you’re going to be borrowing, you’ll then have the option to adjust the length of time that the money will be paid back over. The shorter the length of the loan, the less interest you will pay, so it works in your favour to keep the loan length as short as you possibly can whilst ensuring that you can still afford to pay the monthly repayments. 

Step 3

The next step is to enter your credit score into the calculator - this allows us to give your inquiry a more accurate response, taking your credit score into account so that we can predict how much money you will be eligible to borrow and what the best interest rate available to you will be. This will not be a hard credit search and will not appear on your credit file, instead, this will be a soft search that looks at basic information on your file to give a general impression of how you would fare in a hard check. Please be aware that this is not a formal credit check and your result could differ when undergoing a hard search - this tool is used to give an example of what you may be able to receive, rather than a concrete quote. To get a car finance quote from ChooseMyCar, all you have to do is get in touch with our team and chat with them about the finance plans available

Once you’ve been through these steps, you’ll be able to see whether you can afford to borrow the amount that you were looking to, or whether you may need to look for something a little cheaper to keep things manageable and affordable.


Are hire purchase (HP) agreements a good option?

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 will 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. By using this purchase method, you won’t have to worry about paying the large sum at the end of the contract as you would with a PCP package - instead you will simply own your car at the end of the payments, meaning you can choose to keep the car for yourself or sell the vehicle to fun a newer car for yourself! This flexibility is a very popular way to buy a car, as it makes payments more affordable whilst also eliminating the large lump sum payments often faced at the end of your contract.


Considering a personal contract purchase (PCP) agreement?

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 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.

By choosing to pay for your car using a PCP deal, you’ll be reducing the cost of the monthly payments whilst leaving the decision at the end of the contract entirety up to yourself at the time - you won’t be tied in to own the car at the end of the payment plan should you decide you don't want to. This is great for people who are interested in keeping newer cars, which is a popular choice for many modern drives thanks to the lowered risk of maintenance due to lower mileage and use. On the other hand, should you wish to own your car at the end of your contract, you can do that too! You’ll just have to pay the pre-arranged final fee and the car will be yours to keep. Very few car finance options provide a solution as flexible and affordable as a PCP deal will, making it ideal for new drivers and drivers with bad credit.


Using a guarantor loan for car finance

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.


What cars are available at ChooseMyCar?

One of the major benefits of buying your new car with ChooseMyCar is the incredible selection of vehicles that you have to choose from in our catalogue. We work with over 2500 car dealerships from various locations across the UK, allowing us to offer cars to suit every person’s needs and requirements no matter if you’re after something practical, something comfortable, or something that looks the part. 

If you’re worried about having to choose a car that’s tied to our finance plans, don’t stress about it - all of the cars in our catalogue are available with finance plans in place, so you can pay off the cost of your car in manageable monthly installments, allowing you to pay for your car in the most affordable way possible. You’ll have huge amounts of flexibility with our packages too - you select the deposit and length of the payment plan, giving you complete control over how your plan is structured. We even offer £0 deposits on some of our vehicles, allowing you to get straight into your payment plan without having to pull the funds together for a considerable deposit! Here’s a breakdown of all the different types of vehicle that are available at ChooseMyCar:

Hatchbacks (the UK's favourite!)

The modest hatchback is the UK’s favourite style of car, and it’s easy to see why. Clean, compact, and comfortable, there’s very little that the hatchback doesn’t offer to the driver and passengers, with lots of affordable models available to ensure that everyone has the chance to drive one of these fantastic cars. With a large rear boot that makes up the entirety of the car’s back end, there’s plenty of storage space to aid you in the weekly shopping or trips to visit family and friends, making these some of the most practical cars on the market. Hatchbacks also feature folding back seats, which allow you to find even more storage space for those trips that require a more substantial load. Available at a variety of price ranges to suit every budget, the hatchback is an obvious favourite for city dwellers and rural folk alike thanks to their compact size, practical build, and fantastic efficiency. 

Saloon cars

The saloon car is designed to bring a little more elegance to the driving experience, presenting the passengers with more space, extra luxury, and a more sophisticated feel. With longer wheelbases, there’s far more space inside for passengers in both the front and rear seating - the boot is also completely external to the passenger compartment, which means each area has its own dedicated space. The only drawback to this design is that the boot often has less space and can be a little awkward to lead certain items into.


Estate cars

The estate car is the automobile industry’s answer to people who want the practicality of the hatchback and the comfort of the saloon car, offering the best of both designs for a truly fantastic experience. This is a very popular car across Britain, commonly being used as family cars thanks to their ample space and storage, or for long-distance travelling thanks to their elite level comfort and economy. In addition to this, estate cars are amongst the best models for utilising a roof storage box due to their wider design.

MPV (multi-purpose vehicles)

If you’re looking for immense versatility and practicality from your car, there are few options that rival the MPV. The multi-purpose vehicle is designed to offer the driver exactly what they need as and when they need it - if you’re looking for group trips, you’ve got ample amounts of seating, but on occasions where you’re moving large items you have lots of accessible space thanks to removable rear seats and flush-folding seating which retreats right into the floor. This is ideal for scenarios where you might be moving tricky items such as furniture, which would not fit into smaller vehicles.

SUV models

A rugged, well-built model that’s built for even the most testing terrains - the SUV is ideal for life’s explorer, adventurers, and chancers. A sports utility vehicle will make the most of its four-wheel-drive system when tackling hills or loose ground, making it a great choice for families who like to enjoy the outdoors with camping trips in the wilderness. In addition to this rugged build, you’re also given a surprising amount of comfort, style, and practicality - there is a spacious interior, large boot for all of your belongings, and a variety of incredibly stylish designs available to ensure that you look and feel like the king of the road.


Coupe cars

The coupe takes the saloon car and turns it into the most stylish and fashionable vehicles on the road. These two-door cars feature a hard roof and are often designed to look sleeker and sportier than their larger counterparts - these cars are popular with those who are looking for luxury and style above all else. Whilst these cars may not be the most practical when it comes to hauling luggage to the airport or heading to the shops, they look fantastic and provide a level of style that simply cannot be rivalled by most other categories.

Sports cars

However, there are exceptions to the above rule and that is sports cars - these are the most premium vehicles on the market and are built for those who live fast and don’t have any time to waste. The sports car is all about the thrill of looking like the coolest person on the road - these small, lowered vehicles are built for speed and never disappoint; you can expect to be leaving everyone around you in the rear view mirror when you’re driving a sports car. What these cars lack in space and practicality, they more than make up for in thrill and aesthetic, making them a brilliant fit for those looking to look their best at every moment.

Convertible cars

Last, but certainly not least, we have the convertible - these are cars that are designed to make the most of the sunshine, featuring a drop roof that can be removed as and when you desire. Convertibles are some of the most idyllic cars on the market - they offer an experience like no other, allowing you to find the wind in your hair as you drive through picturesque scenery with the sun blazing. Just make sure you put the roof back up before the rain starts to pour!


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! Our friendly team will be on hand to assist you with any questions or queries that you may have regarding our car finance solutions, so don’t hesitate to get in touch if you require any further information.