Can I get an instant decision on a car finance application?

What is instant decision car finance?

Instant decision car finance means you don’t have to wait long to find out if a lender is likely to accept you. Whether you’ve just found your dream car or your old reliable has broken down, there are lots of reasons you might want an answer quickly.

When you ask for a car finance quote, lenders look at things like your credit history, your income and how much you want to borrow. You'll usually get an answer in around 60 seconds, though it can sometimes take a few minutes.

What’s the difference between an approval in principle and final approval?

An approval in principle means a lender is likely to lend to you, based on what you’ve told them so far. Final approval comes later, once the lender has checked everything properly.

• Approval in principle – based on your answers and a soft credit check. It won’t affect your credit score, and it isn’t a firm offer.
• Final approval – comes after a hard credit check, an affordability check and a look at your documents. This is when you get a firm offer that you can sign.

The lender's decision could change between the two stages, for example if your payslips show a different income to the one you entered, or if the car you choose costs more than you planned to borrow.

An approval in principle usually only lasts for a limited time. If you haven’t found a car by then, you may need to check your eligibility again.

How does instant decision car finance work?

You fill in a short online form, and lenders use a soft credit check to give you an answer in minutes. This also tells you whether you're eligible for car finance and gives you your first quote.

Different providers ask for different things, but you’ll usually need to give some personal details, your job and income, your current and past addresses, and how much you’d like to borrow. They’ll use this to do a soft credit check. This type of check won’t show to other lenders and won’t affect your credit score.

If you’ve been approved in principle through Ocean and you’re happy with the terms, you can choose to go ahead. Your dedicated account manager will then help you with the paperwork, support you with your car search and talk to the lender for you. A hard credit check will also happen at this stage. If everything goes smoothly, you can sign your car finance agreement and pick up your keys. You can find out more about each step in our guide on how to apply for car finance.

Can I get guaranteed car finance?

No, nobody can guarantee that you’ll be accepted for car finance. FCA rules don’t allow lenders or brokers to say or suggest that credit is guaranteed, or that it’s available whatever your circumstances. Be wary of anyone promising guaranteed car finance, as these claims are sometimes used to target people who are struggling with money.

Ocean is a responsible broker, and every lender we work with has its own criteria. We’ll work hard to find the right car finance for you, but we can’t guarantee we’ll be able to help.

How long does it take to get car finance?

It usually takes up to two days to go from an approved application to a signed agreement, but it depends on your circumstances.

If you have bad credit, receive benefits, or are self-employed with an income that changes, it might take longer to get your car finance sorted, as the lender will likely need to look at your application more closely. Lenders also need to be sure you can comfortably afford the repayments, and that the loan won’t put you in a difficult financial situation.

Can I get car finance on the same day?

Sometimes, yes. If your application is simple, your documents are ready and the car is ready to collect, you might be able to drive away on the same day. But it often takes a few days, especially if the dealer needs to prepare the car or arrange delivery.

You’ll also need car insurance in place before you can drive your new car home, so it’s worth getting quotes while you wait for your finance to be finalised.

What checks are done for car finance?

Most lenders will do a soft credit check, a hard credit check and an affordability check, and they’ll usually ask to see some documents. Each lender has its own checks. A hard check is recorded on your credit report, and lots of hard searches close together can lower your chances of being approved as it could suggest you’re relying on credit. That’s why it’s a good idea to use an eligibility checker before you apply and to space out any credit applications.

The affordability check looks at whether you can comfortably afford your repayments. Lenders will look at how much money you have left each month once you’ve paid your essential bills. If you’d have very little left to live on after your car finance repayment, you may be declined.

You may also be asked to send documents to support your application, which may include:

• Proof of identity – e.g. a passport or driving licence
• Proof of address – e.g. a recent utility bill
• Proof of income – e.g. three months’ bank statements or payslips

How can I speed up the car finance process?

You can help speed up your car finance application by getting your documents ready, checking you meet the criteria, and having a car in mind. Every application is a little different, but these steps can help things move as smoothly as possible.

• Prepare your documents – have your payslips, utility bills and driving licence ready, and send them as soon as they’re asked for.
• Apply in working hours – you can apply online at any time, but applying during working hours means any checks can be done straight away.
• Check you meet the criteria – you must be 18 or over to take out car finance. Lenders will often ask for three years’ address history and may ask for full UK driving licence too. It’s worth checking the lender’s or broker’s website for any other criteria before you apply.
• Double-check your details – small mistakes, like a wrong postcode or a typo in your name, can hold things up while the lender checks them.
• Register to vote – being on the electoral roll makes it quicker for lenders to confirm who you are and where you live.
• Use open banking if you’re offered it – some lenders let you share your bank account details securely online, so they can check your income and spending without waiting for you to send statements.
• Have a car in mind – if you’ve already found the car you want, you’ll be able to move much faster than if you’re still searching.

Can I get instant car finance with bad credit?

Yes, you can still apply and get a decision in principle, though it may take longer than usual. This is more likely if you’ve had problems making payments in the past, have had a CCJ or an IVA, or have been bankrupt.

A low credit score can suggest to lenders that you’re more of a risk, so they may need more time to decide. Be ready to send extra paperwork if you’re asked. Some specialist lenders have a person look at your application rather than relying only on a computer. This can take a little longer, but it means they can take your whole situation into account.

Try not to worry. Your credit report is only one of the things lenders look at, and some lenders specialise in car finance for people with poor credit.

Are no credit check car loans available?

No. Responsible lenders will always check your credit before they offer you car finance.

We know life can be tough, and you may have fallen behind with payments or needed a debt management plan or IVA in the past. If that sounds familiar, it’s completely understandable to hope for a car loan without a credit check. But credit checks are an important part of the process. They help responsible lenders make sure you get a loan that’s affordable and suits your circumstances.

Checking your credit report regularly could give you extra peace of mind.

What happens if I’m declined for car finance?

If you’re declined for car finance, it’s a good idea to find out why before you apply again. If you were turned down at the approval in principle stage, it was only a soft check, so other lenders won’t see it.

• Ask why – the lender or broker may be able to tell you the main reason, such as affordability or something on your credit report.
• Check your credit report – look for mistakes, like an old address or a debt you’ve already paid off and ask for them to be corrected. Our guide on how to check your credit score explains this process. There are several free services you can use, including CredAbility, which gives you free access to your Equifax credit report.
• Wait before you apply again – lots of applications close together can lower your chances.

Our guide on whether it’s hard to get accepted for car finance has more tips on improving your chances next time.