Can I get car finance with fair credit?

If you've got your eye on that shiny new car but your credit score isn't exactly perfect, you might be wondering: Can I get car finance with fair credit? In short, yes. But it’s hard to know where this puts you in the eyes of lenders, when you’re not in that ‘excellent’ band, but nor do you have ‘poor’ credit. Having fair credit may not be ideal, but nor should it have to hold you back when it comes to securing car finance. In this guide we explore all the key questions around this tricky topic and break down everything you need to know about car finance with a fair credit score.

What is fair credit?

First thing’s first, let's define what fair credit actually is. Fair credit typically refers to a credit score that falls within a certain range, often between 580 and 669 according to the FICO scoring model. It's not excellent, but it's not poor either. Essentially, it's a middle-ground credit score that indicates some credit risk (perhaps due to past missed payments or high levels of borrowing) but also demonstrates a certain level of creditworthiness that puts you in better stead than somebody with poor credit, for example.

Who is eligible for fair credit car finance?

The good news is that having fair credit doesn't necessarily disqualify you from getting car finance. Many lenders offer car finance options specifically tailored for people with fair credit scores. So, if you find yourself in this credit bracket, you're eligible to apply for fair credit car finance with these specialist lenders, and this means you’re not automatically out of luck when it comes to successfully securing a car loan.

Can you get approved with fair credit?

Yes, you can. While having fair credit could possibly limit your car loan options compared to someone with an excellent credit score, there are still lenders out there who would be willing to work with you. However, it's important to manage your expectations and be aware of the types of car finance agreement you may be offered with fair credit. You may not qualify for the lowest interest rates or the most favourable loan terms, but approval is certainly possible. Always check the loan terms you are offered and consider whether you would be able to afford the monthly repayments for the full duration of the loan before you go ahead.

What are the benefits and drawbacks of fair credit car finance?

One of the main benefits of fair credit car finance is accessibility. It provides an opportunity for people with less-than-perfect credit to get the financing they need to buy a vehicle. However, as we have mentioned earlier, there are drawbacks to consider as well. These may include higher interest rates, stricter terms, and potentially higher monthly payments compared to those with better credit scores. This is because, even though you don’t have poor credit, you may still be viewed as a higher lending risk by lenders, so the higher interest rates and payments are there to help reduce that risk for them.

How to get a car loan with fair credit

Getting a car loan with fair credit can mean you may need to do some strategic planning. Start by checking your credit report for any issues or errors, and take any possible steps to improve your credit if possible. You could also consider taking a little extra time to save for a larger deposit, which can act as a sort of counterbalance to your lower credit score and improve your chances of approval, because you’ll be borrowing less overall. 

How do I find a lender that offers fair credit car finance?

Finding the right lender is very important when seeking car finance with fair credit. And you’re in luck, as here at Car Finance 247 we work with a large panel of lenders, many of which specialise in fair credit car finance and bad credit car finance deals. Simply apply with us online and tell us about your circumstances, and we’ll reach out to our lenders to find you the best, most competitive deals. We essentially shop around on your behalf, comparing offers from multiple lenders to help you secure car finance even with a fair credit score.

How much credit score do you need to get a car loan?

While there's no set minimum credit score needed to get a car loan, having a higher credit score generally improves your chances of approval and allows you to qualify for better terms and rates. There is a general rule of thumb that having a credit score over 670 is viewed as a ‘good’ credit score, while anything between 580 and 669 is considered ‘fair’. However, many lenders offer financing options for individuals with fair credit scores, and even poor credit scores, so having a score in this region doesn’t automatically mean you can’t get a car loan. 

What is the minimum credit score to buy a car in the UK?

In the UK, the minimum credit score required to buy a car varies depending on the lender and the specific financing program. However, as mentioned earlier, having fair credit doesn't necessarily disqualify you from getting car finance.

Why can't I get a loan with a fair credit score?

While having fair credit may limit your options and result in less favourable terms, it doesn't mean you can't get a loan. It may require some additional effort and research to find a lender willing to work with you, but it's certainly possible. If you’ve tried applying with a lender that specialises in car loans for people with fair credit and weren’t successful, then you could try applying with a specialist lender for poor credit finance. Here at Car Finance 247 we work with these types of lenders, as well as lenders who specialise in lending to people who have been refused car finance in the past, so we could help you get a loan with a fair credit score. 

What APR will I get with a fair credit score?

The APR (Annual Percentage Rate) you are offered with a fair credit score can vary from lender to lender, and can also be affected by the amount you’re trying to borrow on the loan, the term length, and the current market conditions. Generally, people with fair credit scores tend to receive higher APRs compared to those with excellent credit, as the risk of lending to them is seen as slightly higher.

Hopefully this article has reassured you that, while having fair credit may present some challenges, getting car finance is still within reach. By understanding your options, improving your credit where possible, and shopping around for the best deal from specialist fair credit car loan lenders, you can secure the financing you need to drive away in the car of your dreams. So, if you're asking yourself, "Can I get car finance with fair credit?"—the answer is yes, you just need the right approach and the right lender.

Still have questions? Check out our FAQs for more information around fair credit ratings