How to Get a Car Loan with Bad Credit
Have you found your dream car but don’t have the cash to pay for it? Are you scared your bad credit will mean being rejected for a loan?
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At Rapid Finance, we have helped thousands of customers get car loans with credit issues. View our full range of car loans.
Bad credit car loans are designed to assist borrowers having trouble obtaining finance through traditional lenders, often due to a low credit score or no credit history.
Lenders may approve loans for individuals with a history of poor credit or those who face challenges in securing loans from mainstream lenders due to factors such as risky employment situations (e.g., self-employment, part-time work), receipt of Centrelink payments, or a need to improve their credit score.
Rapid Finance has specialised in bad credit car finance approvals for over 20 years. We work with a network of understanding lenders who consider your past circumstances and explanations, often funding loans even in cases of bankruptcy (after 12 months).
If you've been declined elsewhere, we could help!
We have over 20 years of experience in securing car loans for people with varied credit histories. Understanding life's challenges like relationship breakups, business issues, or other ups and downs, we offer help even with credit defaults, judgements, job changes, or relocations. Despite a low credit score, we could still assist you.
We could help with car finance for various situations, including bankruptcy, debt agreements, defaults (whether paid or unpaid), repossessions, and court judgements. Even if you've had payday loans, inquiries, a low credit score, or no credit history at all, we may still be able to assist.
Each loan application is unique, and Rapid Finance aims to find solutions for every customer. Being declined by a bank or lender doesn't mean a car loan is impossible.
If you've been declined elsewhere, don't worry - we know lenders who may consider your case. Our Free Financial Assessment offers tailored answers for your financial situation. Start today, and you could soon secure your car loan.
We could also assist in other situations, such as having overused buy now, pay later services, slow payment history on loans, or dishonours and overdrawn fees on your bank statements (with some limitations). Short-term employment, even as brief as one week, may be acceptable in certain cases. Centrelink car loans are also available, and we also consider incomes from bonuses, overtime, and allowances.
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Please note: This is an estimate provided for illustrative purposes only and is based on the accuracy of information provided. It does not constitute a quote. Additional fees and charges may apply dependent on your individual circumstances. Fees, such as early repayment costs and establishment fees, are not accounted for in the examples of weekly repayments. Interest rates may be subject to change throughout the term of the loan.
Have you found your dream car but don’t have the cash to pay for it? Are you scared your bad credit will mean being rejected for a loan?
Read moreThe irony of a credit score is that, often, people don’t know what theirs is like until they need to rely on it. So, how do you know if you have bad credit? And what does it mean for your loan application?
Read moreTurned down due to your credit history? Here's what you can do next to secure finance.
Read moreAs a general term, a bad credit car loan would apply to anyone who has been refused credit, due to their credit history. If you have a credit score of 500 or below, then you would be seen as having poor credit. Even if there is a past bankruptcy, part IX debt agreement or defaults on your credit file, we may be able to assist you - as well as many other situations.
This will depend on your circumstances and needs. If you need a vehicle for work, as an example, then waiting for your credit history to improve would not be practical. At Rapid Finance, we can often get our customers' car loan approvals, even with very bad credit. By getting the car loan and making your repayments on time, you should start to see your credit rating improve over time.
Rapid Finance also offers a service for you to Check Your Credit Report for Free.
A bad credit history can be due to a range of reasons. It could arise due to a simple missed bill from last month, or a failed business venture from years ago. Bad credit can turn up because you moved address and the bill was never forwarded to you, or it could be because of a messy separation! Over the last couple of years, comprehensive credit reporting has turned up, which means, most of the banks are reporting 24 months of payment history on any credit facility you have, back to the credit reporting agencies. Whatever the reason, a bad credit history can make getting finance hard.
In most cases, you'll know if you have poor credit. But it's possible that you don't know the full details. Consider contacting the Australian credit reporting agencies in order to get a copy of your credit history.
It's important to note, that there are 3 Credit Reporting Agencies in Australia. They are :
Equifax
Illion
Experian
The Main Credit reporting Agency is Equifax, however, over the last few years, Illion has been gaining traction - Some lenders check one Credit Reporting Agency, some two of them and some do all three!
It all depends on which Credit Reporting Agency, the credit provider subscribes to - This in itself makes it hard for you to apply for a loan with a lender directly, unless you do extensive research, as it's most likely you will not know which credit reporting agency any given lender subscribes to.
Rapid Finance can help you to Check Your Credit Report for Free and without a mark on your credit file.
Yes, it is possible. You can apply for finance even while receiving Centrelink benefits or a pension. While not every benefit will be counted towards income, many are, including family tax benefits and the veteran’s affairs pension (see car loans for pensioners for a full list of Centrelink pensions which could qualify). In Fact, most benefits can be utilised with the exception of Austudy and Jobseeker as well as a few other smaller benefits.
To get approval for a car loan on Centrelink, you'll need a primary source of income to support these payments. But Centrelink benefits or a pension can be considered as part of your overall financial situation. Still unsure? Call Rapid Finance for more information.
Yes, it is possible through Rapid Finance. We have experience assisting our customers with both paid and unpaid defaults get their car loans funded.
Yes, it is possible. While many of the main banks and lenders will only consider prime applicants - those with a credit score above 600 - Rapid Finance has access to a wide range of lenders and finance options for our customers. We have over 20 years experience assisting our customers obtain finance for car loans with a low credit history.
Yes, if you qualify. No deposit car finance is possible for people with a bad credit history. It comes down to your application and overall profile. But note that if you have a really low credit history, a deposit will add strength to your application and increase your chances of approval. There may also be other options available to you, such as a vehicle trade-in and / or additional security of another asset.
For approval, you will need to demonstrate your ability to meet repayments without any issues. As a Rapid Finance customer, a dedicated finance expert will review your situation, find out what is possible, and negotiate on your behalf. Talk to a Rapid Finance specialist for more information.
Yes, you could get a bad credit loan for a used car, if approved. The details of the loan, such as the loan amount, may be reliant on other factors( Such as your overall profile). Generally cars up to 12 years old are relatively easy to do, however, depending on the age of the car and its value, it can sometimes be tricky to get your dream car - However, a Rapid Finance specialist can assist you through this process.
It's important that you do not apply for credit, if you're still in the research stage. An application for finance will be recorded on your credit history, so making multiple applications across many lenders may flag you as a risk. The biggest mistake, our team at Rapid Finance sees, is a customer applying for the same loan with multiple lenders in a short amount of time. From a lender's point of view, this looks like the applicant is desperate and has no idea what they are doing. Lenders, generally, do not like this. It also affects the customer's credit score, which, in some cases, causes an instant decline. A Rapid Finance specialist assesses your profile for you without putting these hits onto your credit history. After all, with more than 20 years of experience, we are confident we have our customers covered!
When you apply for a car loan through Rapid Finance, we will not run lots of 'hard credit checks' on your credit file, unlike other brokers, who may make multiple applications with lenders on your behalf. With Rapid Finance, we can access your credit file, with what is called a 'soft credit check' in much the same way as you, the borrower, accessing your own credit file. When we have matched you to the right lender, who matches your requirements, we will discuss it with you, before negotiating and lodging the application. At this point, the lender, will generally put a 'Hard hit' on your credit file. So by applying with us, we do all the work, and you will generally end up with only one hard hit on your credit file.
Generally, it’s not possible to get a car loan without a credit check. As part of the National Consumer Credit Protection Act, a credit provider needs to make sure that an application for finance is suitable for the applicant before approval can be made. Reviewing financial information, such as a credit history, is part of this process, especially since comprehensive credit reporting has turned up.
But even if you have a poor credit history, it may be possible to get finance. A credit check helps us find the best solution, especially regarding car loans and low credit ratings. We will try to figure out ways to improve your situation or strengthen your application for finance. In some cases, a previous loan that was paid on time, could help achieve obtaining a loan, even if the applicant has defaults!
Another option, which may not require a credit check, as they are not loans, are rent to own car agreements. These agreements lease you the vehicle over a period of time, agreed in the contract. At the end of the lease, you will be given the option to but the vehicle. They are a convenient way to side step the requirement of a credit check, for people with bad credit.
Yes, it is possible. If you’re self-employed, you can apply for self-employed car loans. We can prove your income and ability to meet repayments based on alternative documentation. Even if you have a poor credit history, there are ways we can look at strengthening your application, depending on your overall profile.
If your car loan is for business purposes, then consider applying for a business car loan. There are a number of options to consider that can potentially reduce your personal tax liability or match repayments with your income.