Applying for car finance is a simple, straightforward process. However, if this is your first time making an application and you’re looking for some guidance then you’ve come to the right place!
To help you understand the car finance application process, we’ve put together a checklist of all the documents you need to hand when submitting your car finance application, as well as some of the main considerations to think about.
Don’t worry, we’ve kept this checklist short and sweet – just like our application process!
To apply for car finance, you will need to be able to prove your identity. The easiest way to do this is with a driving licence as this is the primary way that car finance providers will accept as proof. If you still have the paper part of your licence, you can include this in your documents, however we need a copy of both sides of the photo ID card.
In some circumstances, you can also use a passport as proof of identity, but this will depend on the lender we match you with.
If you need to update your driving licence ID card the best place to visit is the DVLA website which has all the information and links you’ll need to get your licence up to date.
You’ll also need to provide the finance provider with three months’ payslips or bank statements, as this will show to the lender you can afford the monthly repayments.
If you’re self-employed, lenders will accept bank statements, providing they show sufficient evidence of regular income.
In some instances, such as when you cannot provide payslips, we may need to call your employer to prove that you work there. We will not provide any information about your application and the call is just for a quick confirmation.
If you receive benefits, this can usually be counted as part of your income, providing you can prove that half of your income is from employment.
Traceability is an important aspect of your application, therefore when you apply for car finance, you will need to provide your address history for the past three years. If you’re unable to do so, for example if you have only recently moved to the UK, finance providers will sometimes carry out overseas checks to verify your previous residence, however this will vary from lender to lender.
So, that’s all the documents and proofs you’ll need to make a car finance application. However, there are a few important factors to consider before you make your application.
Don’t worry – you won’t need to make a decision on these things straight-away. And at Creditplus you’ll be assigned your own friendly advisor who will be able to discuss these aspects with you in more detail.
However, it’s worth taking these things into consideration at the beginning of the application as this will help to speed up the next stage of the process!
Before you sign up to a car finance agreement, you should take the time to calculate how much you can afford to spend on your monthly repayments.
To do this effectively, you should make a list of all your monthly outgoings – utility bills, food shopping, recreational expenses etc.
Although some of these costs will vary each month, try and calculate your average monthly expenditure. You can then look at your left-over funds and decide how much you’re prepared to spend on your car finance.
Then once you’ve worked out your monthly budget, you can use our car finance calculator to calculate the total amount you can borrow.
There are a number of different car finance options available so it’s worth looking into the types of loans. This way you can decide which works best for you.
For example, if you want to own the car at the end of your agreement, then a Hire Purchase may be the best choice. However, if you’d rather have the option to return the car to the lender and upgrade it for a new model then a PCP Agreement may be more suitable.
When applying for car finance – or any credit loan for that matter, understanding your credit rating is important as it can affect your eligibility for a loan.
At Creditplus, we’re delighted to offer finance solutions across all credit ratings. However, if you have an excellent credit rating, you’ll generally receive better rates than someone with a poor or bad credit rating, because a strong credit profile means you’re considered less of a risk to the lender.
Finally, the exciting part! Once you’ve got the financial aspects of your agreement in place you can decide on the car, and there’s plenty to consider here... Should you go for a classy estate or a trendy SUV? How reliable is it? Is it economical? What colour?
If you need some helping to find the right vehicle, as part of our Find, Fund and Deliver process, our team will help you find your next car and deliver it to your doorstep at no additional cost.
Alternatively, if you’ve got your eyes on a car already and you just need the finance, we’ll simply supply the funds, and you’ll be behind the wheel in no time!
If you’d like to discuss your car finance requirements with a member of our team simply apply online today, without affecting your credit score! Alternatively, if you want to find out how much you can borrow, then calculate your budget using our easy to use car finance calculator.