Refused Car Finance – What to Do Next 2023

Obtaining a car loan might be a great option for buying your desired vehicle. However, it is typical to be turned down from the outset.

You may have been denied auto financing for a variety of reasons, some of which are simple to fix and others of which are more involved.

The good thing is that you always have choices. This book is for you if you’ve been denied auto financing yet think you’re a good candidate for a loan. If you’ve ever had a vehicle loan application turned down, but still want to get behind the wheel of a shiny new ride, this guide is for you.

Step 1: Understanding why you were refused car finance

The first step is to get a better idea of why you were refused car finance. Understandably, most lenders are strict about who they approve for finance. After all, a car finance loan is a big commitment and lenders want to make sure they recoup their investment. Here’s a few of the most common reasons why you may have been refused car finance:

·      A lacklustre credit score

A poor credit score is one of the most common reasons applicants are refused car finance. Most lenders use consumer credit reporting agencies such as Equifax or TransUnion to assess the suitability of car loan applicants. Equifax issues scores of between 0 and 700, with the average Brit clocking in at around 380. TransUnion rates borrowers on a 0 – 710 scale, with averages in the UK sitting at around 610. Experian is another popular agency and ranks you on a scale of 0 – 999.

It’s not always easy to maintain a glowing credit score, as many Brits know. If you’ve ever missed a payment on your credit card, you’re not alone. The latest YouGov research revealed around 15% of UK adults have defaulted on credit card payments, which can knock a decent amount of points off your credit score. The figure is even higher in London, where 19% of credit card holders have missed a payment.

·      An ambitious budget

In other cases, your budget may be too ambitious for lenders to approve. When assessing your application, lenders will consider factors such as your income and ongoing life expenses to determine if you can afford the loan. If there are any doubts, your application may be refused. 

·      Incomplete application

Your application doesn’t just offer lenders insight into your borrowing history but also your competency and organisational skills. Incomplete applications can be an instant turnoff for lenders, so it pays to give your documents a thorough once over before hitting send. 

Now you have a better idea of why you were refused car finance, let’s take a look at what to do next…

Step 2: Ask for help from professionals

It might seem hard to pay for a car, but it doesn’t have to be if you get help from experts. We at My Car Credit are experts at getting Brits into their dream cars, no matter what their credit score is. How do we do it?

· A big loan panel

We work with a wide range of lenders because we have access to one of the biggest loan panels in the country. We don’t just look at a few recommended lenders. Instead, we talk to dozens of lenders all over the country. This makes it much more likely that you will get a car loan, no matter what your situation or spending past is.

Technology that has won awards

We are a part of Evolution Funding, which is one of the biggest and most reliable car loan companies in the UK. Their award-winning technology backs up our service, making it faster and easier for us to find the right lender for your loan application.

A person-to-person method

At My Car Credit, there is no one-size-fits-all method. We look at each application for car financing on its own, so you can be matched with the best loan for your specific needs.

Step 3: Give yourself a better chance
Once you know why you were turned down for car financing and have a team of experts working on your application, it’s time to start making your chances better. This is how:

Raise your credit score.

There are many ways to improve your credit score, some of which are easy and some of which take more time and work. Signing up for the voter list and paying your credit card or phone bill on time are both great ways to improve your credit score. If you don’t have much of a financial past and don’t have a high credit score, asking for a basic credit card can be a good way to build a paper record that shows you are a good user.

· Pad out your deposit

A small deposit shows that you don’t have much money and can be a warning sign for lenders. Saving money when you can and putting it towards your down payment is a surefire way to improve your borrowing status and show lenders you can stick to a regular savings plan.

Getting a car loan with bad credit
Even if your credit past isn’t perfect, that doesn’t mean you can’t get a loan. If you know what to do, you have a good chance of getting car financing even if you have bad credit. If you are having trouble because you are self-employed or don’t have a credit background, we can help.

Are you ready to get your car loan application rolling? Send us an email at enquiries@admin or call us at 01246 458 810 to find out what to do next if you were turned down for car financing.

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