Rapid Finance on 1 June 2022

When you’re looking for a car loan, it’s important to know what could improve your chances of securing your dream car and what could stand in your way. Whether you have a history of bad credit, a low credit score or have used Beforepay and / or MyPayNow, our team of finance specialists are here to help you find finance to suit your unique situation - whatever wheels you’ve got your eye on.

What  is MyPayNow and Beforepay?

MyPayNow and Beforepay allow you to access your pay early, each pay cycle. For a fee of approximately 5% of your pay, they will lend you a portion of the money that you’re expected to get paid by your employer, before your next payday. Each service differs slightly, but the process generally involves setting up an account, inputting some financial information and requesting your desired amount.

These loans differ from payday loans because they involve paying fees instead of interest charges. They also advertise that they don’t run credit checks. 

Do MyPayNow and Beforepay affect my credit score?

Most people know that payday loans can have a negative impact on their overall credit score, but is that also the case for pay advance services? Could using pay advance apps affect your chances of securing a car loan?

A payday loan affects your credit score because each time you apply for one, the payday loan lender will ask credit bureaus to supply them with your credit report. Just by enquiring about your credit score, a ‘hard enquiry’ note is made against your name, and each application temporarily reduces your credit score.

Pay advance services like MyPayNow and Beforepay have slightly different criteria for assessing how suitable you are to receive credit. Rather than running a hard inquiry, they tend to look at your financial history and current situation - using a method called ‘scraping’ to obtain transactional data from your bank account. 

That doesn’t mean your repayments won’t get reported and added to your credit score if they’re late or defaulted, but since the repayments are taken automatically when you get paid, the likelihood of this is significantly reduced.

So, will using pay advance apps affect your car loan approval?

The bottom line is that MyPayNow and Beforepay are just as bad as payday loans and, in most cases, getting a loan is not possible until the applicant has 3 months of bank statements without pay advances on them. Most lenders' views are that the applicant is desperate for money which indicates they can not manage their money. In addition, most lender’s view is that it kills affordability. For example, if you owe 95% of your pay to a pay advance lender, you can not afford another loan. 

In most cases, customers get caught on a merry go round with these types of advances and struggle to get off. This is why most lenders wants to see 3 months of bank statements without any pay advances on them   

If you’re on the market for a new car and believe you fulfill all of the requirements needed for car finance, take a look at our car loan repayment calculator. By adjusting the settings, you can figure out a finance solution that works for you and calculate the interest rate, repayment frequency and the length of the loan. 

Still in doubt? Give us a call.

Concerned that your credit history could impede your chances of getting a car loan? 

Chat to one of our friendly car loan specialists and find out what’s possible for you and your situation. We offer a range of automotive solutions, including new, demo and used car loans, novated lease, chattel mortgage, car refinancing, secured car loans, business car loans and commercial hire purchases. 

Did you know that we provide free finance assessments that won’t affect your credit score? Whether you’ve got bad credit, are in a short term employment situation or just want to explore your options when it comes to car loans, call 1300 467 274 to discuss your situation today.

On a side note, don’t forget about our wholesale cars - We offer the one stop shop where we can help you source a vehicle through our extensive wholesale network - Through our network, we will do some extra checks on your behalf as well as inspecting the vehicle to ensure it’s a great vehicle - We will also check :

  • There is no money owing on the vehicle

  • The vehicle has not been a repairable write off

  • The vehicle has not in any serious accidents 

  • We will check everything works on the vehicle 

  • We will get the roadworthy for the vehicle

  • We will do a detailed inspection on the vehicle

To find out more info about our wholesale Network vehicle, click here

Give us a call on 1300 467 274 or apply online today.