Handing over car keys to new owner

Bad credit car finance

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    Check your eligibility with no impact on your credit score
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    All credit histories and circumstances considered

Zuto is a credit broker, not a lender. Our rates start from 10.6% APR. The rate you are offered will depend on your individual circumstances. Representative Example: Borrowing £8,000 over 60 months with a representative APR of 20.9% the amount payable would be £208 a month, with a total cost of credit of £4,486 and a total amount payable of £12,486.

Can I get car finance if I have bad credit?

Yes you can! In fact, over the last 12 months, we’ve helped more than 100,000 customers* with poor credit get approved for car finance. This is because lenders take more than just your credit score into account, considering other factors such as affordability, credit utilisation, and payment history of other credit products.

Your credit rating may be less than perfect for any of a number of reasons, from you being a young person or student, self-employed or unemployed. If you fall into these categories, you may not have had the chance to build up a positive credit history.

You might be on Universal Credit, have had a County Court Judgement (CCJ) against you in the past, or perhaps you’ve entered into an IVA (Individual Voluntary Agreement). Even though these things can negatively impact your credit score, you may still be eligible for poor credit car finance.

Instead of paying for a car outright with your own money, you can pay using a loan from a lender, repaying the amount borrowed in affordable monthly instalments (plus any interest).

At Zuto, you can apply for finance online or by calling our team on 01625 619 944. If approved, we can guide you through the process step-by-step, to ensure you get the right car, no matter your credit situation.

*data accurate as of June 2023.

Why choose Zuto?

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    Get answers fast

    Financing a car should be simple and straightforward. We’ll guide you through the entire process as soon as you’re approved, from filling out the paperwork to understanding the jargon and small print, so you don’t need to worry about finding a car you love.

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    Expert advice

    We know finding and buying a car isn’t always easy, so we’ll help you make the right choice. We offer impartial advice while checking your chosen vehicle’s history and valuation for free.

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    It's free!

    We don’t charge any fees for using our service, and never add hidden costs. This means you can make an informed choice without any nasty shocks or surprises.

Customer reviews

A selection of reviews from customers who we've helped get car finance with bad credit.

What is bad credit car finance

Bad credit finance works like any other type of loan, the only difference is that it’s specifically for people who have low credit scores or minimal credit history.

Because of this, you and your lender will assess how much you can afford to repay the loan through monthly instalments, plus interest.

Types of bad credit car finance

At Zuto, our two most popular finance options are hire purchase and personal contract purchase (PCP), but you can also choose to take out a personal loan:

Hire purchase (HP): with hire purchase, you pay regular monthly instalments over a pre-agreed period, equal to the cost of the car plus interest. At the end of the term, you’ll own the car outright. The interest rate - and therefore how much you’ll pay every month as part of your Hire Purchase agreement - can change based on your credit score, and a lower score might also mean you have to pay a larger deposit at the beginning. 

However, one of the benefits of a HP agreement is that it provides exactly the kind of structured payment plan that credit scoring companies look out for. As long as you keep up with your payments, it can help boost your credit score over time.

Personal contract purchase (PCP): with personal contract purchase agreements, you also pay regular monthly instalments over an agreed term. However, rather than the full cost of the car, the payments are equal to the depreciation of the vehicle plus interest. To own the car outright at the end of the agreement, you’ll need to make a final ‘balloon payment’.

Again, your credit score can influence both the interest rate you’ll pay on the agreement and therefore your monthly payment, and also the size of the final balloon payment at the end of the car finance agreement. One of the key benefits of the PCP approach to poor credit car finance is that it gives you quite a bit of flexibility which may suit your circumstances better. At the end of the agreement, you can choose to make the balloon payment, but there are other options available to you too such as returning the car, part-exchange and refinancing.

Personal loan: a personal loan is a sum of money borrowed from a financial institution like a bank. The main difference between traditional car finance options and a personal loan is that, with a personal loan, you own the car immediately.

We go into more detail about our two most popular finance options in our guide: What’s the difference between PCP and HP?

What kind of car can I get on finance if I have bad credit?

Whether you’re looking for your first wheels or a family run-around, we can help you find your next car. If you already know what you want, get in touch with our team and we’ll guide you through our lenders’ requirements – and if not, we can help you find the perfect model. Some of the most common models financed by customers with bad credit include:

What is considered bad credit?

There are a number of reasons why you might have poor credit, but it’s important to know why and how it can affect you. Put simply, poor credit means you have a low credit score, which can have a direct impact on your ability to access loans or credit and, if you do, you may end up having to pay larger deposits or higher interest rates on your borrowing.

Credit reference agencies keep track of your borrowing and repayments to help determine your credit score, and the more reliable you are, the higher your credit score will be. If you miss payments, or don’t make them at all, your score will decrease, which can push you into the ‘bad credit’ category. If you find yourself in that category, it can harm your chances of getting affordable finance in the future. 

That’s not the only thing that affects your credit score, however. Someone with debts who meets their payments regularly can have a much higher credit score than someone who has never taken out a loan or had a debt at all - that’s because they’ve shown they’re able to meet regular payments. There are a number of easy ways to improve your credit score.

The UK’s three main credit reference agencies each use different metrics to measure credit, so there’s no universal ‘bad credit’ score. However, each has their own bands for bad and poor credit scores:













It’s relatively simple to check your credit scores for free. You can sign up with Experian, Equifax and more to get your current credit score, see any issues that they flag and you’ll also receive regular updates as your score changes. It’s worth knowing that applying for credit can impact your credit score, but Zuto uses a ‘soft search’ when you check your eligibility that has no impact on your score.

See how much you could borrow with our handy calculator

How to get car finance if you have bad credit

With Zuto, you can apply online without impacting your credit rating. After completing your application, we’ll approach our panel of lenders to find the options available based on your personal circumstances.

Here is how you can apply for car finance with bad credit today:

  1. Apply online - Zuto carries out an initial soft credit check on your application, which enables us to match you with one of our lenders. This doesn’t affect your credit score but does give us, and you, an idea of what cars for bad credit are available.
  2. Tell us what car you’re looking for– If we approve your application, one of our team will get in touch to discuss potential quotes, as well as talking about the car you’d like to buy. Don’t worry if you haven’t found a car yet, our team can help you with that too!
  3. Choose the right option for you – If you’re happy with the APR and monthly repayments, we’ll help you with all the admin, take care of the paperwork, and negotiate with the dealer to make sure you drive away with the perfect car.

Our team has over 15 years of experience in helping drivers find the right poor credit car finance, and we accept applications for people with defaults, County Court Judgements (CCJs), Individual Voluntary Agreements (IVAs), mortgage arrears, or late payments on their credit history.

What is the best car finance for bad credit?

When it comes to bad credit car finance, there is no one type that is best for you, as everyone’s requirements and personal situations are different.

Here at Zuto, our main types of car finance include the following:

Where can I get a car with bad credit?

It can be intimidating to search for car dealers who work with bad credit, which is why the team at Zuto can help you find the vehicle you need as well as finance, free of charge.

We work with a range of dealers across the country, and are here to help you through the entire finance process, meaning you can get the right car for your needs without any added stress.

How long does it take to get a car with bad credit?

There is no set time limit for how long it takes to get a car on bad credit. Every situation is different, but our team will work hard to make the process as quick and streamlined as possible. We’ll be on hand every step of the way.

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Bad credit car finance FAQs

Find out what our customers are asking when it comes to applying for car finance with bad credit.

How does bad credit impact interest rates?

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Credit scores are a sliding scale, so the worse your credit, the higher interest rate you may have to pay. If you improve your credit score, you may have access to lower rates. However, actual rates will depend not only on your credit history, but also the lender itself. The terms of the loan and your income stability will also be a factor in the rate you pay.

Is it hard to get accepted for bad credit car finance?

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In general, you are more likely to be accepted for car finance if you have a good credit score.

It can be more difficult if you have a poor or bad credit score, but, as a broker, Zuto is able to help find potential options for you by searching our large panel of lenders.

Find out more about car finance eligibility.

Can I get car finance with no credit history?

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It can be tricky to finance a car if you have no credit history, but it’s not impossible. By getting to know you and your financial situation, we can search our panel of lenders to try to find a deal which suits you and your personal circumstances.

Can I get finance with a CCJ?

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Yes, you can apply even if you have a County Court Judgment (CCJ), but it can make getting approved harder. Zuto works with a large panel of lenders who can help you if you have a lower credit score.

Find out more in our guide: Can I get car finance with a CCJ?

Can I get finance with an IVA?

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You might be eligible with an Individual Voluntary Arrangement (IVA). At Zuto we work with a large panel of lenders who specialise in this field.

Discover more about IVA car finance.

Why have I been refused car financing before?

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If you’ve been refused financing on a car before, it might be because you:

  • Had a low credit rating
  • Tried to borrow too much.
  • Didn’t have a deposit.

We go into this in more detail in our guide: what should I do if I’ve been refused car finance before?

Can I finance a car if I’ve been made bankrupt?

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If your bankruptcy has ended and you’ve been discharged, you can apply without issue. However, we typically recommend you wait 12 months to try to build up your credit score again – you can find more help and advice in our car finance bankruptcy guide.

What if I have a default on my credit profile?

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You can apply for a loan if you have a default, but your chances of being approved are likely to be lower due to the default itself impacting your credit rating.

Discover more information about applying for car finance with a default.

Can I get car finance with poor credit?

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Car finance depends on your personal circumstances. With over 15 years’ experience, we’ve helped thousands of customers find bad credit finance and a car deal that works for them.

You can apply for car finance with Zuto without impacting your credit score. We’ll then approach our lenders and share the options with you. If you decide to proceed, we’ll perform a ‘hard search’ which is when your credit score could be affected.

What credit score is too low?

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There is no set limit for a loan application – it depends on your personal circumstances. You can apply with Zuto without affecting your credit rating; if you’re eligible, you can then proceed, and we’ll carry out a ‘hard search’ which can affect your credit score.

Can you guarantee finance with bad credit?

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Unfortunately, we can’t offer a guarantee that you’ll be able to finance a car with bad credit. This is because we need to run a credit search to determine whether you can afford to make the monthly repayments.

However, if you’re unsure whether you’ll be eligible, feel free to apply and we’ll conduct a soft search. This doesn’t impact your credit score, and gives you an idea of whether you’ll be accepted by one of our lenders.

Find out more in our guide: guaranteed car finance explained.

What’s the difference between a ‘soft’ and ‘hard’ credit check?

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A soft credit check is an initial look at certain information on your credit report. Lenders do this to decide how successful your application would be without conducting a more detailed assessment of your credit history. Soft searches aren’t visible to lenders, so they have no impact on your credit score or any future credit applications you might make.

A hard credit check is a more detailed search of your credit report. Each hard search is recorded on your credit report for two years, so any lender searching in the future will be able to see that you’ve applied for credit.

What are the benefits of bad credit car finance?

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While the restrictions placed on your finance due to poor credit may seem limiting, there is one key advantage to bad credit financing.

As financing requires regular repayments, you’ll be able to start improving your credit score from month one. Missed payments are a key reason for low credit scores, but by making repayments you know you can afford each month, you should soon start improving your score.