Handing over car keys

Car finance on benefits

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    Apply today with no impact on your credit score
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    All credit histories considered
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    Benefits seen as part of your income

Zuto is a credit broker, not a lender. Our rates start from 7.9% APR. The rate you are offered will depend on your individual circumstances. Representative Example: Borrowing £7,000 over 48 months with a representative APR of 19.3%, the amount payable would be £205 a month, with a total cost of credit of £2,831 and a total amount payable of £9,831.

Can I get car finance on benefits?

At Zuto, we assess each car finance application on an individual basis depending on your personal circumstances. Because being on benefits means you have some sort of income, our panel of lenders takes this into account.

We like to help people find car finance whatever their situation, so here are a couple of key things to think about:

  • Can you put down a deposit - if so, how much? While we do offer no deposit car finance, a deposit can reduce your monthly payments, which makes them more affordable.
  • Do you have a good credit score? The better your credit score, the more likely it is you’ll get approved for car finance. You can find out how to improve your credit rating with our useful guide.

Find out what costs to consider when buying a car or use our car finance calculator below to see just how much you could borrow.

Car finance calculator

See how much you could borrow

What type of benefits are usually accepted?

Zuto helps people on many types of benefits find car finance. Benefits are seen as your income, with commonly accepted types including:

  • Employment and Support Allowance (ESA) – ESA is for those with a health condition or disability, affecting how much they can work. ESA replaced the Incapacity Benefit in January 2011.
  • Personal Independence Payment (PIP) – PIP is for those with long-term health conditions or disabilities. It replaced the Disability Living Allowance (DLA) in November 2017.
  • Child tax credits – child tax credits are provided to parents with dependent children. Dependent means you are entirely responsible for them and their main carer.

Can you get car finance on universal credit?

Universal credit is a benefit provided to low income households to support standard living costs. It is paid monthly and the amount you receive depends on how much you earn.

At Zuto, we take your personal circumstances into account, on an individual basis, to find you the right lender and car finance solution.

If a benefit isn’t listed above, we might still be able to help. Apply for car finance with no impact to your credit score or contact us for more help and advice.

What could affect my eligibility when applying for car finance on benefits?

We often help people who are on benefits find affordable car finance. However, it’s not always so straightforward, and the following factors could negatively impact your application:

  • Bankruptcy – bankruptcy is a declaration that you can’t afford to pay back debts.
  • Individual Voluntary Arrangement (IVA) – an individual voluntary arrangement is a court-approved agreement centred around you paying back debts you already owe.
  • County Court Judgement (CCJ) – a county court judgement is an order that means a person must pay off a debt.
  • Bad credit history – late repayments on other credit agreements could be a concern for lenders when applying for car finance on benefits.

If any of these apply to you, it’s still a good idea to get in touch with us to see if we can help. Apply with no impact on your credit score, and we’ll let you know if you’re eligible for pre-approved car finance.

Car finance with bad credit and on benefits

While it can be difficult to get bad credit car finance on benefits, it’s far from impossible. To improve your chances of qualifying for hire purchase finance or a PCP loan, we work with a broad panel of lenders.

If you have any questions about the process, please contact us to talk to one of our team about your circumstances.

Applying for car finance on benefits: what are the next steps?

If you’re applying for car finance on benefits, it’s important get in touch with our team of experts to find out what we can do for you:

  1. Speak to us about your situation over the phone.
  2. Our team can discuss with you the best way to proceed.
  3. We can run a tailored search across our panel of lenders.

If you’re approved, we’ll discuss your available options.

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