One Lender Refusing You Credit Does Not Mean You Can't Borrow Finance Elsewhere

Most people who already have a car do not think about trading it in for a new one until something goes wrong. If this were to happen, there are not many people who have the finances to pay for a car straightaway so are forced to take a car loan. If you need or want to buy a car and do not have the finances to do it, the first point of contact would be your bank and as a current account holder, you may be able to get a good deal as you are already and existing customer. But there are some people out there that have a bad credit history that even their own bank won't lend any money to them.

If you are one of those people who have bad credit for whatever reason, this could be a serious setback as most places do credit checks for even the simplest of things. Mobile phone contracts, renting, opening up a bank account, utility bills, they all do credit checks before accepting you as a customer. So even though you have saved hard to buy a car, you may not always have the whole sum so a car loan will be needed to cover the rest.

Bad credit can leave a blemish on your file for a range of reasons; it could be from paying bills too late, unarranged overdraft fees or because of another person such as rent on a joint flat that has been paid too late. You can still get car finance even though you have bad credit but be prepared to pay higher interest. You may also be limited in car finance companies who are prepared t lend you money. On the other hand, if you have a large deposit for a car and need just a few thousand pounds as finance, then this may work in your favour as on the application form it will ask for the price of the car and how much you want to borrow. The less you borrow against the car you wish to purchase the better; the more you need to borrow the more you will pay in interest as this is where they make money on what they lend you.

If you believe that your credit file is wrong, then you will need to contact them to get it rectified. Everyone should check their credit file at least once every two years as once there is a flag on your file, it's much harder to remove. Making sure it is up to date and any old bank accounts are closed and inactive will help keep your credit score up. There are many places that will also give you free advice so that you don't get turned down again; this will be handy as then you won't have to search endlessly for a loan in the future. Remember that bad credit car finance is out there but you'll be paying a lot more than a standard loan.