How to Buy a Car with No Credit or Bad Credit

There’s no hiding from the fact that buying a car is REALLY  expensive. In fact, it’s probably one of the biggest financial outlays you’ll make this year. Or next. Unfortunately, not many of us have a big enough pile of cash just lying around to buy our car outright. This means that it’s not unusual to turn to finance to help fund our purchase.

Herein lies the problem: if you’ve got a bad credit rating or have no credit history at all, you may struggle to borrow what you need. So what can you do when not having a car simply isn’t an option?

Rebuild your credit score

It may take time, but with some patience and a little ‘know-how’, it is possible to improve your credit score.

When companies are deciding whether or not to lend you money, they are essentially using your past financial behaviour to predict how you are likely to behave in the future. This is why it can be hard to get finance with both a poor credit history AND if you have no credit history at all.

In order to prove that you’re going to be a responsible borrower, you need to build up a history of responsible financial behaviour. It may sound a bit ‘chicken and egg’ but it is possible.

Credit rebuild cards or short-term finance

You could take out a credit rebuild card (basically a credit card for those with bad credit), then spend a little on it every month. Only spend what you would have spent anyway. Then pay it off in full to avoid paying any interest.

Normally, all other things being equal, your credit rating should start to improve after around 6 months.

Alternatively, short-term loans can be used in a similar way. Just like credit rebuild cards, taking out short term finance may help you to rebuild your credit rating. However, bear in mind that when you take out a loan, you will have to pay interest and maybe extra charges on it, so always read the small print.

Lenders specialising in bad credit

If you need to buy a car urgently and do not have the time to improve your credit rating, there are lenders who specialise in providing loans to people who have a poor credit rating. Often, you will end up paying more interest on these loans, so they could end up costing you more.

Make sure you only borrow what you can afford to repay

If you are going to take out any kind of finance, whether it be a credit card or a loan, make sure you only borrow what you can comfortably afford to pay back.

Buying a car if you have a poor credit rating, or no credit history at all, is difficult but not impossible. There are loan providers who lend to people with bad credit. Rebuilding your credit rating should improve your likelihood of being accepted for finance when you need it and give you more options when it comes to choosing a loan that’s right for you.

I had a look at her website and tried to stick to the style but let me know if anything needs changing.

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