When you’re looking to buy a new car, the process can seem daunting and complicated. There are so many factors to think about – not just the make and model of the vehicle but insurance, maintenance, road tax and financing, to name just a few.
Buying a car represents a significant financial commitment, and not everyone can afford to pay up front and in full for their new wheels. For those who can’t, a finance agreement is often the next best solution, but even those can be difficult to source for those with a less-than-perfect credit history.
With that in mind, here are a few ways you can enhance your score and improve your chances of being approved for the bad credit car finance that will help you find your next vehicle.
Register on the electoral roll
It may sound simple, but getting on the electoral register at your current address can help to improve your score in the eyes of potential lenders. It will form a key factor in the identity checks that lenders will carry out when you apply for credit, so having this information readily available will increase your chances of approval.
Limit your credit utilisation
If you have successfully applied for credit in the past, try not to use the full extent of that facility. Use as little as you can – 25% is often seen as the benchmark that will put you in a favourable light with lenders. So, if you take out credit of £1,000, try to limit your usage to around £250, rather than the full amount.
Correct any errors
Any mistakes on your file, such as erroneous personal information like your address, could be harming your score. Furthermore, if the accounts on your file are still linked to someone with a poor credit score, that could be pulling your rating down. If you are no longer connected to that person, you can take steps to have that link removed from your file.
Make payments in full and on time
Late, missed or incomplete payments will soon show up on your report, so make sure you’re in a position to meet those regular commitments in full every time. Even one missed payment can remain on your report for years, although if it is just a single instance then your score should recover in full after 12 months.