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How your credit score affects your car finance application

When you apply for any type of finance, being credit searched is an unavoidable part of the process. Your credit score demonstrates to lenders how you have dealt with borrowing money in the past. This gives them the best indication of how you will manage any future debt, including car finance.

If you’re unsure of what a credit score is or what it means we have put together a credit score guide to help answer your questions.

Your credit score

Your credit score will impact your ability to borrow money. A bad credit score will make some lenders less likely to accept you. This is because your credit history shows that you haven’t been able to keep up with payments in the past and they will consider you as a higher risk customer.

If you know that you have bad credit then you might want to look at ways you can improve your credit score. If you’re unsure of what your credit score is then we would advise that you check your credit report using a service such as Experian or Check My File. This will allow you to see which rates you are likely to be eligible for before applying.

Applying for finance that you aren’t eligible for will result in you being rejected, leaving a mark on your credit file and potentially harming your chances of being accepted for credit elsewhere.

What credit score do I need for car finance approval?

The credit score you will need for car finance approval will depend on the lender you apply with. All lenders have different criteria, so the minimum score required will vary from one company to the next. As with any type of finance, the higher your score the better the rate you will be eligible for. However, there are still lenders who will be willing to offer you car finance, even if you have bad credit.

Bad credit car finance

If you have a bad credit score then getting a car loan is still possible, you just have to choose the right lender. At Red Potato, we work with a lender who bases their lending decisions on much more than just your credit score.

We will still consider your application, even if you:

Although we will try to help anyone in any financial situation, approval for car finance is subject to status and income.

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This website is operated by Premium Plan Limited. Red Potato is a trading name of Premium Plan Limited, which is registered in England with Company No 05977118. Registered office: Kempton House, Kempton Way, PO Box 9562, Grantham, Lincolnshire, NG31 0EA. Premium Plan Limited is authorised and regulated by the Financial Conduct Authority (FRN: 742272). The Red Potato name and logo are trademarks of Totemic Limited. Premium Plan Limited is a member of the Finance & Leasing Association (FLA).