Car finance eligibility isn’t an exact science, and different lenders have different criteria that applicants must satisfy to be approved. But the good news is that this means people with a wide variety of circumstances can find a car loan that’s right for them. At Ocean, we work with a panel of lenders to help you secure the best deal for you. We can assess the eligibility of all applicants, including those with bad credit.
How our car finance eligibility checker works
Making a car finance application can be nerve-wracking. Not only is buying a car likely to be one of the biggest purchases you make in your lifetime, but it can be hard to know whether you’ll qualify for car finance at all.
That’s where our car finance eligibility checker can help. It’s a handy free tool that can give you a good indication of whether you’ll be accepted for car finance before making a full application.
All you need to do is enter a few personal details as well as information regarding your current financial circumstances. It can also help us give a more accurate result if you can let us know roughly how much you might need to borrow and how long you’d like the loan term to last.
We’ll use all these details to assess your affordability and perform a soft credit check to find out if you’re likely to be approved by of the lenders on the panel. It takes just a few minutes to get a decision.
If you’re approved in principle, you’ll receive a tailored quote that will remain valid for 30 days. Don’t worry, getting a quote won’t affect your credit score and you’re under no obligation to proceed if you change your mind.
It’s also worth keeping in mind that your car finance eligibility isn’t guaranteed; the checker should serve as a guide rather than a firm approval. Your eligibility may change if you’ve accidentally entered the wrong details or your circumstances have changed. And if you do choose to proceed, we’ll carry out a hard check of your credit report (more on that below).
What if I get rejected for a car loan?
While nobody likes being rejected for car finance, it may be useful to know that there is more than one reason why your application might have been turned down. It’s not always about your credit score, either; a range of factors can influence your car finance eligibility.
If your finance application is rejected, it can help to try to find out why. Double-check that you haven’t made a mistake while entering your details, and review your credit report. Poor credit scores can be improved over time, and you could take steps to get yours in better shape before applying again.
If you don’t need a car straightaway, you might want to wait before making another application. Unfortunately, having too many hard searches on your credit report in a short amount of time can negatively affect your credit score.
Even so, being rejected by one finance provider doesn’t mean you won’t be eligible for car finance with another lender. Applying through a car finance broker like Ocean could help. We work with a panel of lenders, including those that specialise in offering bad credit loans. You might also improve your chances of being accepted by choosing a cheaper car or appointing a guarantor.
What details do I need to check my eligibility?
Lenders consider several factors to help them determine whether you’re eligible for car finance. While each lender has different eligibility criteria, there are a few things that can contribute to a car loan application being approved or rejected, such as:
- The car you want to buy – the vehicle’s price, make, model, and age
- The deposit – the amount you can afford to put down upfront (if anything)
- Your age – you must be over 18 years, and some lenders may impose upper age limits or restrictions
- Your employment status – self-employed and agency workers may still be eligible, but could find it harder to get approved
- Your monthly income – an average amount can be considered if you have variable income
- Your affordability – how much disposable income you have left over once all your essential bills are paid
- Your credit history – this demonstrates the type of borrower you’ve been in the previous six years
- The amount you want to borrow – a rough estimate is fine
- The loan term – typically between two and five years
What credit score do I need to be approved for car finance?
There’s no set credit score that can guarantee you’ll be approved for car finance. In fact, your credit score can change depending on the credit reference agency that the lender uses. Credit scores are important as they can help show a lender how you might act as a borrower, whether you’ve missed payments in the past or kept up with your bills each month. However, they don’t tell the full story and won’t be the only factor that determines whether you’re eligible for car finance. You may be able to secure a loan even if you have a bad credit score, have a CCJ, or have been subject to an IVA.
What’s the difference between a soft credit search and a hard credit search?
When you enter your details into our car finance eligibility checker, we’ll perform a soft credit check of your credit report. This won’t be visible to any future lenders checking your file and you can undergo several soft checks a year without affecting your credit score.
A hard search will only take place if you’re happy with the quote offered and choose to proceed with your car finance application. We’ll make sure you’re fully aware before running a hard check as these are visible to other lenders and can stay on your credit report for up to 12 months.
It’s good practice not to have too many hard credit checks in a short space of time, if possible, as this can flag to potential lenders that you’re relying too heavily on credit. If you choose to take out a car finance agreement, we’ll carry out both a soft and hard credit check before you sign on the dotted line.
Can I get car finance with bad credit?
If you’ve fallen behind with loan repayments in the past, had a CCJ, or been subject to an IVA, your credit score might have taken a hit. And while it can be more difficult to find car finance with a bad credit score, it’s not impossible. You just need to find the right lender. Here at Ocean, we have direct access to finance providers that specialise in bad credit car finance. You may need to pay a higher rate of interest that reflects the additional risk to the lender, but you may still be able to secure a hire purchase or personal contract purchase loan.
However, if you’re struggling to find a car finance approval with bad credit, you may wish to consider increasing your deposit (if you can) or choosing a cheaper car so you can borrow a lower amount. You could also consider improving your credit score and applying later down the line.
Get Car Finance up to £100,000
- Check your eligibility without impacting your credit score
- No deposit needed
- Rates from 9.9%* APR
*Representative example: Borrowing £6,500 over 5 years with a representative APR of 19.9%, an annual interest rate of 19.9% (Fixed) and a deposit of £0.00, the amount payable would be £166.07 per month, with a total cost of credit of £3,464.37 and a total amount payable of £9,964.37. Rates may differ as they are dependent on individual circumstances. Subject to status. We're a credit broker, not a lender.