Can I Get Car Finance Without a Credit Check?

If your credit score has seen better days, you may be wondering if it’s possible to get car finance without a credit check.

The truth is, bypassing a credit check when applying for car finance isn't an option. 
Credit checks are a standard part of any credit application process, as they are in place to give lenders an idea of how you manage your debts.

However the good news is a poor credit score doesn't necessarily mean it’s the end of the road for your car loan application.

In this useful guide, you’ll learn about the types of credit checks lenders use, and ways to improve your chances of approval.

Let's explore how you can approach a car loan application with confidence, credit check included.

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Can I get car finance without a credit check?

When it comes to securing car finance, the idea of skipping the credit check might seem appealing, especially if you're concerned about your score.

However, the reality is that credit checks are a fundamental step in the car finance application process.

Lenders use them to not only determine whether to approve the loan, but also the terms of the loan including how much they’re willing to lend, how much interest they’ll need to charge and over what time period they’ll require you to repay it.

The good news is that even with a poor score, you could still get the loan you need to get behind the wheel of your dream car. It might just mean you’ll end up paying more in interest.

What types of credit check do car finance lenders use?

>Lenders typically perform one of two types of credit checks when you apply for car finance: hard checks or soft checks. 

Each serves a different purpose and has a different impact on your credit score.

Hard check

A hard check is a thorough review of your credit history and lenders use it when you make an application. 

It gives them a detailed look into your credit history, including your repayment habits, outstanding debts, and overall credit management. 

This type of check can slightly lower your credit score temporarily. It's visible to other lenders and indicates that you're seeking new credit.

Soft check

A soft check is more of a preliminary review and doesn't impact your credit score at all. 

Lenders may perform this type of check to pre-approve you for an offer, or when you're shopping around for deals you may qualify for. 

Soft checks are only visible to you, not other lenders, and are a way to gauge your eligibility without affecting your credit.

If you are worried your current score may stop you from getting accepted, a soft check can put your mind at ease. 

If it does reveal that you won’t currently get accepted, you can start taking steps to turn things around.

What other things do they check?

As well as credit checks, lenders look into a few more details to get the full picture of your finances.

They're interested in your income and job stability as this shows you have a steady stream of money coming in to cover your loan payments.

Your current level of debt is also on their radar; they want to see how much you owe elsewhere to see if taking on a new loan is feasible for you.

They may also review your past and current addresses to verify your residency and living circumstances.

These checks help lenders decide how risky it is to give you a loan.

More credit guides

How can I buy a car without a credit check?

While traditional car finance without a credit check is off the table, there are alternative routes you could explore if you're looking to avoid the credit scrutiny.

Saving up and paying cash for a car is the most straightforward way to bypass credit checks altogether.

If cash purchase isn't an option right now, you could explore car leasing, although you won’t own a car when leasing (the vehicle will be owned by the lease company) and this may also still require some form of credit assessment.

Another possibility is to consider getting a co-signer with a strong credit history to back up your application which could improve your chances of approval.

Remember, each of these alternatives has its pros and cons, so weigh them carefully to decide which one is right for you.

How can I improve my credit score?

If your score isn’t currently where you want it to be, don’t worry, there are plenty of practical things you can do to start turning it around.

Kick things off by giving your credit report a thorough once-over to spot any inaccuracies. Finding and fixing any errors is a quick way to boost your credit score.

Make sure you pay those bills on time and if your credit cards are maxed out, start chipping away at paying off those balances.

Hanging onto older credit accounts helps your score by building out your credit history. You can also add in a mix of credit types by applying for a new credit card, phone contract, or loan.

Just remember, boosting your credit score isn't a sprint, it’s a marathon. It takes time to see significant changes, especially if you’re starting with a poor score.

Can I get guaranteed car finance without a credit check?

We hate to break it to you, but no car finance offer is guaranteed without a credit check.
You may be given a preliminary offer after a soft search, but a guaranteed offer is typically only available once a hard search has been conducted.

There is no way around it – if you want a car loan, you’re going to need to undergo a credit check.

If you are worried your score will impact your chances of approval, it’s better to focus on improving it.

There are ways to turn it around to ensure you don’t get stuck with a high interest loan.

At Carmoola, we consider most credit scores, but they do influence how much money we can offer you and the APR you’ll be charged.

FAQs About Credit Scores:

Why is my credit score different on different sites?

The way your credit score is calculated differs between the three UK credit reference agencies. They each use a different scoring method to work out your score. For this reason, the numbers do vary between them.

Is car finance based on affordability or credit score?

Car finance decisions are influenced by both your affordability and credit score. Lenders assess your credit score to see how you have handled previous debts, while your current income and expenses are evaluated to determine your ability to afford new debt. It’s a holistic approach to assessing your suitability for finance.

How can I get car finance without a credit history?

Obtaining car finance without a credit history is more challenging but not impossible. Options include securing a guarantor with a strong credit history or beginning to build your own credit through steps such as using a credit card or a small, manageable loan.

What is the lowest credit score that I can get car finance with?

There isn't a definitive minimum credit score for securing car finance; however, lower scores may result in higher interest rates or larger down payments. Specialist lenders offer loans for those with lower scores, but it’s important to carefully compare your options to ensure you’re getting the best deal.