How to increase your chances of getting a car loan


Getting a new car can be a really exciting time. The beauty of car financing is that it makes owning a car more affordable. Car finance allows you to split the cost into monthly payments with added interest. Most people use finance to get better cash than they first thought too! What’s not to love? But what happens if you can’t get accepted for finance?

There are a number of factors that could affect your chances of getting accepted for finance. Finance lenders put a few restrictions in place to make sure they don’t lend to anyone who can afford to pay their finance back. Let’s take a look at how you can increase your chances of getting a car loan.

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Which factors could hold you back from getting car finance?

To comply with responsible lending practices, finance lenders have to protect customers and themselves. Irresponsible lending would be offering finance to someone who can’t afford it or has had problems in the past making repayments. Due to this, there are a few factors that lenders can put in place before they will offer you finance. 


Your affordability is how much you can afford to pay for your finance deal. Lenders will usually ask you to supply bank statements or wage slips to show your income and expenditure each month. They can then work out if you can comfortably afford to pay back your loan. If you already have high levels of existing debt, finance lenders may assume that you can afford to take on any more finance too. 

Credit score

Your credit score is important when it comes to car financing. However, if you are applying for bad credit car finance, not all hope is lost. Your credit score usually reflects what type of borrower you have been in the past and the best rates may be reserved for those with good credit scores. This is because they are seen as less of a risk to the lender. 

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Car finance is a legal agreement and because of this, you usually have to be 18 years old before you could get accepted for finance. Young people may also struggle to get approved for finance as they don’t have much of a credit history yet. You could be better off applying for finance once you are 21 and have hard evidence of taking out a car loan. On the other end of the scale, there may be a limit to how old you can be to take out finance. Many lenders have a cut-off of 75 years old. 

How to increase your chances of car finance approvals

If you have been struggling to get approved for car finance, there are a few ways in which you could increase your chances. 

Work on your credit score

As mentioned above, your credit score is important when it comes to car financing. You could increase your chances of approval by working on your credit score in the run-up to finance applications. You should get into the habit of checking your car finance regularly and make sure all your information is accurate and up to date.

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You can increase your credit score by making all your current payments on time and in full, reducing any existing debt you owe, keeping your credit utilisation low, and not taking out any new credit in the run-up to your application.

Do a joint application

A joint application can help you to get approved if you are struggling. A joint car finance application is when two people, usually a couple, apply for finance on the same car. Both applicants will be responsible for meeting to repayment deadline so it gives the lender more security that the loan will be paid back on time and in full. 

Check lender requirements

It may be worth shopping around for car finance deals with different lenders. Finance lenders have their own specific requirements before they will accept people for finance. For example, some lenders may be able to help with bad credit or people who receive benefit income. 

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Save up for a deposit

Some car finance agreements require you to put down a deposit. Having a deposit for car finance can help you to get approved and also help to reduce your payments. Putting more in for your finance deal means you don’t have to borrow as much from the lender and lets lenders know that you are more financially responsible. 

When you take out finance with someone else, you will become financially linked to your credit files. If you have financial links with those who have bad credit, their score may be bringing yours down too. If you no longer have any active credit with them, you can ask your credit referencing agency to remove them from your credit file. 

Daniel Odoh
Daniel Odoh
A technology writer and smartphone enthusiast with over 9 years of experience. With a deep understanding of the latest advancements in mobile technology, I deliver informative and engaging content on smartphone features, trends, and optimization. My expertise extends beyond smartphones to include software, hardware, and emerging technologies like AI and IoT, making me a versatile contributor to any tech-related publication.

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