Car Finance with Fair Credit: What You Need to Know

What is considered “fair” credit?

The first step is to understand exactly what “fair” credit means. UK lenders use three major organisations to source credit scores – Experian, Equifax and TransUnion. Each uses a different system to determine credit scores. Here’s a quick overview of what’s considered “fair” by each:

Experian – 721 – 880

Equifax – 380 – 419

TransUnion – 566 – 603

Fair is preceded by rankings of “good” and “excellent”. At the lower end of the scale is “poor”, which is anything below the lowest numbers listed above. 

Why credit scores matter

Credit scores are one of the most useful ways for lenders to evaluate the financial history of potential borrowers and assess overall risk. Experian, Equifax and TransUnion use information like your direct debit history to assess your borrowing patterns and assign an individual credit score. They’ll also look at hiccups like missed payments and multiple credit card applications.

The higher your score, the less risky you’re considered. Applicants with strong credit scores enjoy a suite of benefits, including higher credit limits, lower interest rates and an increased chance of success. However, a lacklustre credit score doesn’t necessarily rule out car finance. You still have options, which is why it’s important to connect with experts who specialise in securing car finance with fair credit.

Can I get car finance with fair credit?

Fair credit doesn’t mean you have to rule out car finance. With the right broker and a strong application, you can still secure auto finance with a less-than-perfect credit score.

What to expect when applying for car finance with fair credit

Applying for car finance with fair credit isn’t always as straightforward as applying with an excellent score but it is possible. Here’s a quick overview of what to expect and consider throughout the process:

Stay realistic

Lenders are far more likely to approve your application if your expectations are realistic. For example, an affordable model like a Hyundai i10 is a much better choice than a luxury car like Land Rover. Similarly, considering buying used instead of new can be a great way to save money and win over lenders.

Be proactive about boosting your score

You can’t go back in time and make that missed credit card payment. But you can boost your credit score by doing things like joining the electoral role.

Apply for car finance with fair credit today

Wondering if you’re eligible for car finance fair credit? Give My Car Credit a call today to discuss how we can help you secure car finance with fair credit, or a lower score.