So Is Used Car Finance A Good Way To Buy A Car In The UK?

These Days The Answer Is Yes!

For prospective car buyers, a question that invariably comes up is if guaranteed car finance really is available in the UK, even with a bad credit history. The good news is that the answer is a definite yes. There are several proven ways for most any person to be assured of getting adequate finance to purchase a vehicle.

If a traditional lender such as a bank refuses to give an individual credit to purchase a car, there are always many other types of lenders to approach life for instance who offer used car finance to apply for the loan. The common point to remember about these special lenders is that they'll invariably charge a much higher interest rate than a standard lending company. This is done to ensure that in case the loan applicant defaults on the money given him, the higher interest rate charged will assure that the company will at least obtain a significantly higher amount of the total lending amount back before having to possibly take the car away from the individual who was given the loan. But they're definitely an excellent source of funds to a wide variety of people.

People with bad credit are at a greater risk of not paying back the money they were given. A way around this is for lending companies to simply ask for a much more substantial amount of money up front towards the purchase of the car. By doing this, the company reasons correctly that the person loaned the funds will be more serious and diligent about paying back his loan on time and in full because he now has a much stronger financial interest in the overall car purchase. Often, between twenty five-thirty three percent is required as a down payment in order for the lending transaction to successfully go through.

Find A Cosigner?

If a potential car buyer can find a family member or friend with excellent credit and enough annual income to get approved for a loan, then he can simply directly ask this individual if he would be so kind as to cosign the loan. This will almost always ensure that the financing will go through for the person with bad credit. This procedure is done every day all across the UK and companies that lend money for car purchases feel very comfortable, safe and secure about such transactions.

Or Purchase A Less Expensive Vehicle

If all else fails in the attempt to finance a vehicle, the best way to go is for the buyer to simply shop around for a much less expensive car. By doing so, it will mean that a much lower amount of funds needs to be extended to the buyer and this considerably lessens the monetary risk in the eyes of any lending institution. Less money extended to buy a car means less chance of the company losing a lot of money if the person doesn't or can't end up paying it all back.