Zuto is a credit broker, not a lender. Our rates start from 10.9% 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 19.7% the amount payable would be £204 a month, with a total cost of credit of £4,219 and a total amount payable of £12,219.
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 bad 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.
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.
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.
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.
A selection of reviews from customers who we've helped get car finance with bad credit.
Bad credit car 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.
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 Hire Purchase for bad credit 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?
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:
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:
| Experian | Equifax | TransUnion |
Bad | 0-560 | 0-438 | 0-550 |
Poor | 561-720 | 439-530 | 551-565 |
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.
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:
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.
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:
It can be intimidating to search for car dealers who will accept people getting car finance with very 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.
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.
Thinking of getting a new car, but not sure if your bad credit score will stop you getting finance? Read our guide to find out more.
Ever wondered how applying for car finance affects your credit score? Our guide explains everything you need to know before applying.
Whether you’ve got an excellent or bad credit rating, there are always ways to improve or maintain it – and we’ve picked out 15.
Find out what our customers are asking when it comes to applying for car finance with bad credit.
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.
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.
No credit car financing can be tricky to attain. This is because you have no credit history for lenders to understand your reliability, 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.
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?
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.
If you’ve been refused financing on a car before, it might be because you:
We go into this in more detail in our guide: what should I do if I’ve been refused car finance before?
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.
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.
Getting car finance with very bad credit can be hard but is not impossible. Car finance depends on your personal circumstances. With over 15 years’ experience, we’ve helped thousands of customers find bad a credit finance 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.
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.
Unfortunately, we can’t offer a guarantee that you’ll be able to get a car finance deal 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.
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.
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.
Yes, it is possible to get car finance with bad credit and no deposit, although it might be more challenging. Some lenders may require a deposit to reduce the risk, but others might offer no-deposit options. Keep in mind, without a deposit, you may face higher monthly repayments or interest rates.
Yes, you can apply to refinance a car loan with bad credit, but your options may be more limited, and the interest rates may be higher compared to standard loans. Refinancing could help reduce your monthly payments, especially if your credit score has improved since you took out the original car finance deal.
Approval times for bad credit car finance may take longer compared to applicants with good credit because lenders need to carry out more detailed checks to assess affordability and risk. However, with Zuto, we work quickly to get approvals for bad credit car deals, and the process can still be efficient.
Yes, being self-employed doesn't prevent you from getting car finance for bad credit, but lenders will likely ask for additional documents, such as tax returns or proof of income stability. Your credit history and affordability will still be key factors in your application.
