Can I get a car finance even if I have a bad credit rating?
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What interest rates should I expect to pay if I have a bad credit rating?
abbielee
1 year ago
Expert Financial Adviser Answer
Darren Smith
answered 1 year ago
yes it will be possible but what you need to consider is that if you find a willing lender they will inevitably charge a higher rate of interest or possibly even want security over the car.
the end result of this is that you would end up paying significantly more for the car.
the following example is not in any way monetarily accurate but consider:
you buy a car today for £5000. with interest the loan for the car will cost £11000 over 5 years. How much is that car worth then? £2000 if you are lucky?
how about wait a bit until your credit has improved, save some cash - you should be able to do this if you can afford to pay the car loan, then when your credit is in a better place you will not only have adjusted your budget to afford the car loan, you wont need as large a loan as you will have a cash deposit to put down and the rate of interest on the loan would have improved and that could halve the cost of interest in one hit!
this of course is before you work out how much the maintenance on the car will cost and the insurance, are you better waiting until you have that next year of no claims bonus?
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the end result of this is that you would end up paying significantly more for the car.
the following example is not in any way monetarily accurate but consider:
you buy a car today for £5000. with interest the loan for the car will cost £11000 over 5 years. How much is that car worth then? £2000 if you are lucky?
how about wait a bit until your credit has improved, save some cash - you should be able to do this if you can afford to pay the car loan, then when your credit is in a better place you will not only have adjusted your budget to afford the car loan, you wont need as large a loan as you will have a cash deposit to put down and the rate of interest on the loan would have improved and that could halve the cost of interest in one hit!
this of course is before you work out how much the maintenance on the car will cost and the insurance, are you better waiting until you have that next year of no claims bonus?
