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 or universal credit score 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.

Demystifying “credit history” and “credit report”

When you’re researching your credit score for car finance, some other terms you may come across are credit history and credit report. So, how do these relate to your credit score?

Firstly, your credit history is what credit reference agencies use to calculate your credit score. It includes credit utilisation, monthly repayments, bill payments and other financial factors.

This is compiled into a credit report, which includes your credit history alongside your debt to income ratio, address history and even whether you’re on the electoral roll.

Your credit report includes your credit score, which is generally what a finance company will use as eligibility criteria for a finance agreement.

Another term you might see is credit rating. This is simply another way of referring to your credit score.

How it affects your car finance application

Now onto the main point of interest – how do credit scores impact car finance deals? The answer is simply down to risk and reward.

Personal contract purchase, hire purchase and personal contract hire are all ways you can borrow money to finance a car. Credit scores from the main credit reference agencies are essentially a barometer of how reliable you are when you borrow money.

If you have a high credit score (good or excellent), it shows that you’re a reliable borrower that’s more likely to keep up with monthly payments. As a responsible borrower, you’re less of a risk for finance companies. This means you’ll likely meet the minimum credit score required to be approved for car finance. In many cases, it may also unlock the best car finance deals with lower interest rates.

On the flipside, a low credit score from a credit reference agency indicates bad credit history. This could impair your chances of being approved for car finance, but it’s not the only factor lenders take into consideration. While many lenders have a minimum credit score, different lenders will have their own criteria for drivers with a poor credit history.

You can increase your chances of success with a larger initial deposit, for example, or by finding the best deal for your circumstances with more favourable repayment terms. Smaller monthly instalments repaid over a longer term may be easier for you to keep up with, for example.

What does My Car Credit define as a “good” credit score?

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 roll
  • 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, which stands for county court judgement

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 car finance 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

Whether you have a higher credit score or a poor credit rating, My Car Credit is dedicated to helping all drivers secure the right car finance in the UK. We’ll guide you through your car finance options, such as personal contract hire, personal contract purchase and hire purchase to find one that’s right for you and your credit score.

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 loan application details, our team works hard to find a suitable deal from our panel of lenders. Check our handy online calculator to see if you are eligible for car finance.

Rates from 9.9% APR. Representative APR 12.4%

Evolution Funding Ltd T/A My Car Credit

My Credit Rating


  • 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


  • 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


  • 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


  • 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


  • 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

Typical rate

Loan amount

Total payable




*for illustration purposes only

No impact on your credit score*

Representative Example

Borrowing £7,500 at a representative APR of 12.4%, annual interest rate (fixed) 12.36%, 47 monthly payments of £196.44 followed by 1 payment of £206.44 (incl. estimated £10 option to purchase fee), a deposit of £0.00, total cost of credit is £1,939.12, total amount payable is £9,439.12.

Evolution Funding Limited, trading as My Car Credit, is a credit broker and not a lender.

Please ensure you can afford the repayments for the duration of the loan before entering into a credit agreement.

*Initial application is a soft search. Should you progress, some lenders may perform a hard search on your credit file.

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!