Can I Get Car Finance With a Bad Credit Record?

Buying a car is a huge financial step and arranging vehicle finance is undoubtedly more difficult for those with a bad credit history. Not surprisingly, because any lender will view them as a high-risk client who may struggle to pay the loan back. However, it’s not impossible and there are lenders who specialise in offering finance to those with a bad credit score – it will just take some extra time and effort

What is the minimum credit score for car finance?

A TransUnion credit score ranges from 0 to 999. This rating measures a person’s likelihood to repay a debt. A higher credit score indicates a lower-risk borrower and more likely to make on-time payments. These are the score bands:

  • EXCELLENT 767 – 999
  • GOOD 681 – 766
  • FAVOURABLE 614 – 680
  • AVERAGE 583 – 613
  • BELOW AVERAGE 527 – 582
  • UNFAVOURABLE 487 – 526
  • POOR 0 – 486

Knowing what your credit score is can help you enter the car buying process on a strong footing. Find out where to check your credit score.

While a lower credit score won’t necessarily mean you won’t secure a car loan, it will very likely lead to costlier monthly instalments due to higher interest rates.

Steps Towards Getting a Car Loan

If you have a poor credit score but need to purchase a vehicle badly, you’ll have a better chance of qualifying for a loan if you begin with these steps:

  1. Check your credit report and make sure there are no mistakes that can negatively affect your credit score. Then, see exactly what is contributing to your bad credit score and improve on it.
  2. Pay a deposit upfront. Aim for the highest amount you can afford. A bigger deposit is more likely to get you better loan terms. Besides telling the lender you’re a serious client, it also helps lower your vehicle instalments.
  3. Provide proof of a regular monthly income.
  4. Apply for pre-approval before visiting the dealership. This will help negotiate better terms for yourself.
  5. Shop around and compare rates from multiple lenders specialising in bad credit financing.
  6. If you’re a young first-time car buyer with little credit history, consider asking a relative who is willing to stand surety for the car loan – and ensure you commit to making payments on time.
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Other ways to buy a car if you have a poor credit record

  1. In-house vehicle finance – Enquire from your dealership, as some do offer clients financing without going through a bank or other third party financial institution.
  2. Rent-to-own – With this option, while the dealership won’t need to see your credit score, they will need proof of income, proof of residence, and a valid driver’s licence. The rent-to-own vehicle becomes yours after all monthly payments for a fixed term (usually 24-60 months) is made. Alternatively, you can choose to buy the car at any point during the contract for a specified price.
  3. Taking out a personal loan or using your credit card is an alternative way to buying a car, however, you need to do some careful calculations and planning around affordability and paying it back. Remember that the interest rates on these are very high, so consider carefully before jumping in.


Buying a car with bad credit can be a challenge, and at this point you might question whether bad credit car finance is a good idea at all. Ultimately, it will depend on your credit rating, your affordability, the interest rate offered, and other factors. If you’re unsure, you might want to consider a credit counselling session to have an expert guide you through your options.

If you’re on the market for a quality used car, visit your local Auto Pedigree dealer for advice on suitable vehicles and financing options.

Also read

Your Guide To Credit Scores In South Africa

Where To Check Your Credit Score

Ways To Improve Your Credit Scores

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Disclaimer: Auto Pedigree and the authors make no representations as to the accuracy or completeness of any information on this site or by following any link on this site. Auto Pedigree and the authors will not be liable for any errors or omissions in this information nor for the availability of this information.