Finding your ideal set of wheels is only half the battle when it comes to securing car finance. In reality, the most crucial part of the process is getting a credit check so lenders can assess how likely you are to repay your loan.

The credit check will reveal your credit score – a rating based on financial history that helps lenders determine who qualifies for a loan, potential risk, interest rates and credit limits. So, what counts as a ‘good’ score?

What is a good credit score?

Having a good credit score increases the likelihood of securing a low-interest loan, meaning you pay less overall. In contrast, falling below the range makes it harder to find funding.

Unfortunately, it isn’t easy to provide a definitive answer as the key credit reference agencies (Call Credit, Equifax, Experian and TransUnion) have independent scoring systems. Plus, most lenders adhere to internal guidelines.

However, a recent Experian report provides some clarity. According to their findings, in September 2019 the average credit score was 715 for a new car loan and 662 for a used car loan. Despite this, their website categorises someone as “good risk” if their score falls between 881-960. The contrast in figures suggests it’s relatively easy to obtain finance even if you fall below the desired limit.

The scores calculated by TransUnion and Equifax are more generous. TransUnion defines “good risk” as between 604-627 while Equifax goes even lower at 420-465.

What does My Car Credit define as “good”?

If you use our free car finance calculator, you can select which credit profile best suits your circumstances. The information button defines each credit profile, with “good” described as:

  • You are on the electoral role
  • You are a home owner or long standing tenant
  • You have a stable employment history
  • You have current credit arrangements with occasional missed payments
  • You have no CCJs

Evolution Funding, the broker behind My Car Credit, uses a combination of Experian and Equifax scoring combined with their own clever algorithm to determine which lender is best for your circumstances. Evolution Funding defines a good score as being an ‘Evo Score’ of 650 and above. However, they cater for customers with scores much lower than this so don’t feel disheartened if you have a less than perfect credit score. There is also lots of advice available in our Help & Advice section on how to improve your credit score.

How we can help

If you have a compromised credit history, you may still be eligible for finance. There’s just a little more work to be done before acquiring a loan. That’s where My Car Credit can help. Using your application details, our team works hard to find a suitable deal from our panel of more than 30 lenders. Get in touch today to see how we can help you.

Rates from 6.9% APR. Representative APR 13.9%

Evolution Funding Ltd T/A My Car Credit

My Credit Rating

Excellent

  • You are a home owner
  • You have been on the electoral role for a long period of time
  • You have current credit arrangements and mortgage with no defaults
  • You have no CCJs, credit arrears or missed payments
  • You rarely apply for credit
  • You are employed or self-employed

Good

  • You are on the electoral role
  • You are a home owner or long standing tenant
  • You have a stable employment history
  • You have current credit arrangements with occasional missed payments
  • You have no CCJs

Fair

  • You are or have recently been on the electoral role
  • You may have recently changed address
  • You may have occasional missed payments
  • You may have an old CCJ
  • You may have regularly applied for credit

Poor

  • You may have had frequent changes in address
  • You may not be traceable on the voters roll
  • You may have exceeded credit card limits
  • You may have missed payments on current agreements
  • You may have had a CCJ in the past

Bad

  • You may not be traceable on the voters roll
  • Your credit cards are over their limits
  • You have recent CCJs
  • You may have been refused credit elsewhere
  • You may be in a debt management plan
£

X monthly repayments of
£X

Typical rate

Loan amount

Total payable

X% APR*

£X

£X

*for illustration purposes only

No impact on your credit score

Representative Example

Borrowing £7,500 at a representative APR of 13.9%, annual interest rate (fixed) 13.85%, 47 monthly payments of £201.38 followed by 1 payment of £211.38 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £2,176.24, total amount payable is £9,676.24.

My Car Credit is a credit broker and not a lender.

Require more help?

Got a question you can’t find the answer to, or need some advice and guidance around taking out car finance? Our Car Credit Specialists are friendly, experienced, and here to help so get in touch today!