Bad credit? Tips to get your car loan approved
Getting approved for a car loan might seem like a mountain to climb, especially if you have bad credit. It’s not all doom and gloom, but it can be worth knowing what can help get you across the line. Get clued up on what lenders are looking for to improve your chances of approval next time!
Give your bank statements a spring clean
Lenders will often need to see 90 days of recent bank statements to check you can afford loan repayments. Clean bank statements can really help get approved for finance, especially if your credit isn’t the best. Which means minimal missed payments or un-arranged overdrafts, no payday loans, and no signs of gambling or serious financial hardship.
Know that bad credit isn’t everything
Luckily, bad credit doesn’t always mean you’re destined for denial when applying for a car loan with The Lending People. But as responsible lenders, there are other factors which contribute towards getting your car loan approved – including regular income, a steady job, any other loans, time at home address and clean bank statements. If you have bad credit, it’s worth considering these factors to strengthen your loan application.
Get those bills paid
While bad credit might not be everything, improving your credit can help get your car loan approved. A better credit rating also usually means a lower interest rate. Gas bills and phone contracts might not be your favourite thing to spend your hard-earned pennies on. But paying your bills on time is one of the most important things you can do to improve your credit (and chances of finance approval!)
If you’re having financial difficulty, it can be worth getting in touch with the company quickly, rather than waiting for debt collectors to come knocking. Sometimes a company can work with you to lower your payments or allow you to pay off your bill over time.
Avoid pay day loans
Pay day loans can be easy to get. But it’s easy to get trapped in a tough cycle of re-borrowing to make payments. Pay day loans can be a sign of un-affordability when it comes to a loan application, making it near impossible to get a car loan approved, or any other loan.