Car Loan: A guide to buying a car with a poor credit score

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Getting approved for a car loan can be difficult, especially if you have poor or no repayment history or have had a CCJ.

But – whether you need a new run-around, have your or eye on your dream car or could do with something that has a bit of extra boot space – there are a few things you can do to help your chances of being approved for a small loan to cover the cost of a car and the other upfront expenses.

Before you apply for your car loan

Before you apply for your car loan, try to think about ways to keep the costs down as much as possible. The less you have to borrow, the better your chances of being accepted.

That being said, it is always better to spend a little bit more on a reliable, decent car than to take a gamble on a car that is in a bit of a bad way. You’ll save yourself a lot of money, hassle and stress in the long run.


New or used?

New cars often come with a lot of additional extras – such as warranty, free services, guarantees – that can keep costs down in the first few years. You may even be able to trade in your old car to reduce the initial cost, or use it towards the deposit before paying the rest of the price off in instalments.

On top of that, new cars are generally safer, have much lower emissions and are much more environmentally friendly – saving you money on insurance and road tax. Plus, you won’t have to take it for an MOT for three years after you’ve bought it.

However, new cars often come with a much larger price tag and are a larger upfront investment.

Unless you’ve found a great deal for a new car, secondhand – or preloved – cars are a great alternative. Sure, they might have a few tiny scratches and imperfections, but that only adds to their character. Plus, insurance is lower and you’re much more likely to find yourself a bargain.


Buying secondhand cars: A few things to bear in mind

Sites like Gumtree, AutoTrader and eBay – as well as local papers and secondhand dealerships – often have great deals on good quality secondhand cars.

Be sure to have a good rummage around for the best deal while keeping in mind an idea of the rough price that your ideal car, in good condition costs. Once you’ve found a car that you’re keen on, arrange a viewing to inspect the car to make sure that the pictures and descriptions were accurate.

In addition to kicking the tyres and having a nose under the bonnet, here are a few things you can do to make sure that you’re getting a good deal:


Make sure that the car – and all of the details you are told – are genuine

It used to be quite a common practice for shady or less-honest secondhand car-dealers to wind the mileage back on the cars they were selling. Although this happens a lot less now, it’s still something that’s worth keeping an eye out for, even though is a little bit tricky to spot. A quick way to get an idea of the car’s mileage is to watch out for any obvious signs that the car is well travelled – worn seats, steering wheel or seatbelts are a common sign, as are lots of little chips and scratches on the body work.

If you’re still in doubt, the average yearly mileage for cars is 10,000 miles a year. Do some quick mental maths and if the figure seems suspicious in comparison to the condition of the car, ask for a reason. If you’re not convinced or something seems off, it might be better to walk away and go back to the drawing board.


View the car in daylight and with another person, if possible

Good lighting and weather conditions will help you see any damage, scratches or dents on the body that may not be immediately obvious.

Taking another person along gives you an extra set of eyes – and it’s always a good idea to have somebody there to ask any questions you might forget. If you know a mechanic – or somebody who knows a lot about cars – they’d be a great person to take along. They often spot things that the untrained eye would miss. If you don’t know a mechanic, the RAC and AA offer a service to check everything over and make sure you’re getting a good deal.


Ask to see the documentation

Ask to see all documentation related to the car: the MOT certificates from the past three years, the handbook, the service history and the VC5 documentation. It’s important to get a sense of the car’s history and – importantly – to check that the person that’s selling it to you is allowed to do so.


Make sure you’re happy with the car

This one is probably the most important – do you like the car? It’s a big decision and investment, so make sure you’re completely happy with it. Take it for a test drive; see how it feels, how it handles and whether you enjoy driving it.

If this is the dream car you’ve always wanted – how does it make you feel? Like a kid on Christmas Eve? Do you want to show it off to everybody you know? If the answer is yes, that’s great. It’ll be your car soon.

If you’re looking for more practical reasons, make sure you’ve considered every option – is it big enough for the pushchair? Can you turn the airbags off in the back? Does the radio work?


Once you’ve chosen your car

This is where things start to get exciting – just a few more things to do, then you’ll be driving your new car away.

Firstly, make sure that you’re getting the best deal possible on the car. If you think that you can get a better price on the car, don’t be afraid to negotiate – most of the time, people mark up the asking price because they anticipate of being negotiated down a little. Explain your situation and ask what their best price is – you’ll be surprised at how much you can save!

Secondly, double check the price of insurance payments and any work that needs doing, and factor these into the amount you’d like to borrow.

A quick way to save money is to pay for the year’s insurance upfront. Car insurance is often cheaper if you pay in one lump sum – plus, it means you don’t have to think about it again for another year. If you’re worried about the monthly cost of the insurance, it might be worth factoring the yearly cost into your loan amount.


Applying for your car loan

That’s it – if you’ve done all of these checks and are happy with the car you’ve chosen, there’s nothing left to do but apply for your car loan, get the money and drive away.

Bamboo offers a range of loan options – including guarantor loans – that have been designed to help you be approved quickly and be on the road as soon as possible.

Having a guarantor, for example, increases your chances of being approved for a loan, even if you have a CCJ and a poor credit score. To find out more, read our guarantor loans guide.

Once you’ve decided how much you’d like to borrow, simply complete an online form with a few details and we’ll take a look and make a speedy decision on the best car loan we can lend you. Representative 49.7% APR.

If you’re happy with it, we can have it approved and in your bank account within 24 hours – which gives you enough time to buy yourself some furry dice, bumper stickers and tree shaped air fresheners before you hit the road.

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