If you’ve been refused car finance on one or more occasions, you’re not alone. In fact, many thousands of would-be borrowers have their applications for car finance refused every day.
On the plus side, even a series of car finance refusals doesn’t have to count you out of the running. Instead, it’s a case of determining why your application for car finance was rejected and doing something about it.
1. Your credit score isn’t up to scratch
Some lenders base their decisions almost exclusively on credit scores. In which case, you’ll be counted out of the running in an instant with bad credit. Poor credit doesn’t have to stand in the way of affordable car finance, but you need to ensure you target appropriate lenders. Otherwise, you may be out of luck.
2. You’re too old (or too young)
Even if a lender claims to offer car finance for customers aged 18 to 70, this doesn’t mean your age won’t be a factor. The closer you are to these upper and lower age limits, the more difficult it becomes to qualify for car finance. Again, some specialist car finance firms are more flexible than others, so it pays to shop around.
3. No source of income
Vehicle finance specialists aren’t typically interested in your life story. Instead, they simply want to know that you’re in a stable financial position and can afford the repayments accordingly. Nevertheless, if you have no provable source of income and aren’t in the best financial position at the time, you’re unlikely to qualify. Always consider your financial position carefully, before submitting an application for any financial product.
4. You asked for too much
Your financial position and budget will determine how much you can comfortably borrow. Not to mention, how much the lender in question is willing to offer. One of the most common mistakes made among car finance applicants is applying for more than they need and more than they can afford. If the lender suspects you’re applying for too much, they’ll simply reject your application. In any case, attempting to borrow more than you actually need is never a good idea.
5. Application Errors
Last but not least, there are instances where car finance applications are rejected, despite the applicant being in a pretty perfect financial situation. In which case, it’s perfectly possible that the application was rejected due to one or more simple errors. Fields completed incorrectly, insufficient supporting documentation, failure to provide acceptable ID – just a few common reasons for car finance refusals. Always triple check your application before hitting the ‘send’ button and ensure you’ve provided all the necessary documentation.