Guaranteed Car Finance UK
If you are looking to finance a new car, you may have noticed the abundance of providers offering ‘guaranteed car finance’ deals. We are here to help you understand your options and choose the best car finance deal for your needs.
What is Guaranteed Car Finance?
Consumers with a bad credit score or poor payment history typically have a smaller chance of being accepted for a car finance loan. As such, offers marketed as guaranteed finance are often a popular choice.
Whilst no car finance is guaranteed, there are many providers who specialise in car finance deals for consumers with poor credit scores. However, the interest rates of car finance for bad credit will typically be much higher when compared with customers with a good credit score.
Best Guaranteed Car Finance Providers
Below are some of the leading car finance providers for poor credit customers. These providers compare multiple loans to help you find the best car finance deals for your circumstances and increase the likelihood of being accepted.
Can car finance really be Guaranteed?
There are a number of reasons you may be looking for a guaranteed car finance provider, perhaps you have a low credit score or may have had an application rejected. Before you apply, it is important to understand that in reality, no provider can legally guarantee car finance.
Car finance providers are regulated by the Financial Conduct Authority (FCA), which ensures that they must lend responsibly. Every loan that is provided must consider the customer’s current situation, looking at whether it is affordable and suits their requirements.
There are many providers who offer car finance deals to customers with a poor credit score or payment history. However, the interest rates are typically much higher for a low credit score. To save money on the overall cost of your loan, it is advisable to work on improving your credit score before applying for car finance to receive a better interest rate.
What if I have already been rejected?
One of the first steps is to work out why a lender has refused your application. There are a number of reasons you may have been rejected for car finance, ranging from a poor credit score or no credit history at all to not holding a full driving license or your employment status.
Applying for too many loans can work against you, so it may not be the best idea to jump straight to a provider offering guaranteed car finance, as you may not be accepted. Instead, work to improve the area that led to your application not being approved, and then apply again in the future.
Will I need a Guarantor?
A great way of increasing the likelihood of being accepted for car finance is to have a guarantor. In short, a car finance guarantor is someone who has a good credit standing and will pay the finance lender if you fail to make the payments.
If you do not have anyone who can act as a guarantor, you may still be able to apply for poor-credit car finance with no guarantor. It is important to understand that interest rates may be higher compared with applicants that have a good credit rating, so you may want to consider improving your score before applying to help reduce the overall cost of your finance.
How to get accepted?
Below are a few tips to help improve your chances of being accepted for car finance. Following these tips may also help you receive a better interest rate, which will save you cash on the total cost of your new car.
- Ensure you are registered on the electoral roll at your current address. You can enrol here.
- Don’t apply too many times in a small time-frame, as this can be a seen as a negative to creditors.
- Ensure you have a full UK license at the time you apply for a car finance loan.
- Having a mobile on a pay monthly contract can help boost your credit score.
- Ensure you are able to pay a deposit, as you will often have better success than with no deposit car finance.
Check Eligibility & Apply
We hope you have enjoyed our guide, and have a better understanding of guaranteed car finance in the UK. If you are ready to check your eligibility and apply, ensure you have some basic information to hand and get started. We recommend using a broker, such as Car Finance 247, if you have poor credit or have been refused in the past.