Bank Said No to Your Car Loan? Here’s What You Can Do

Bank said no to your Car Loan? Receiving a no from a lender is an all too familiar scenario for many Australians. When you have your heart set on a vehicle only to find out you cannot receive finance to buy it can be crushing. However, there are ways you can still gain access to finance and buy your dream car.

Here’s how to get a car loan after a lender has said no.

1. Improve your Lendability

The main reason why many people get rejected for a car loan is because they are classified as not credit worthy. If you are classified as not credit worthy this means you are deemed a risk to a lender and a high chance of defaulting on repayments.

If you have been classified as not credit worthy, don’t stress, you are not alone, there are ways you can improve it. The first thing you need to do is gain your credit score. Once you get your credit score, try to understand what category you are.

Once you understand your credit score position, look at ways you can improve it. The best way to improve your credit score is to try to reduce your current Owings or repayments. If you already have financial commitments, it will make it all that harder to receive additional finance from lenders, so the first thing you should do is to try to cut down your borrowing amounts.

If you limit or reduce your total expenses some lenders may reevaluate your application and even give approval as you now may be in a position to repay the loan needed.

2. Shop Around

One of the biggest mistakes people make when it comes to applying for car finance is only applying for finance with one lender. The problem with doing this is if that particular lender declines your loan application you will be back to square one.

One of the good things about the current Australian financial landscape is there are an abundance of different lending options available to you. With that being said, you need to shop around and apply for finance through multiple different lenders. If one lender declines your loan, another might approve it, they are all different and look for different things. The only way you will be able to get access to finance is to shop around and see what is out there!

3. Speak to a Lending Professional

You shouldn’t feel down about being turned down for car finance, it happens to a lot of people. It just means you need to work on a few things. A good way you can increase the chance of receiving a car loan approval is by talking to a lending professional.

The benefit of seeking expert advice from a lending professional is they will tell you firsthand what you need to do and how you can go about receiving car finance. Some lending professionals may even point you in the right direction or organise finance on your behalf.

4. Build Your Savings

One of the best ways you can increase your chance of receiving car finance is to build your savings. If possible, try to start and maintain a savings history. Having a savings history shows lenders that you have the ability to budget and prioritise your spending.

The best thing about building a savings history is it will ultimately limit the amount of money that you need to borrow. Sometimes by having just that little bit more in savings can be all it takes to receive approval from a lender.

5. Look at Other Loan Types

There are work arounds if you have been declined for car finance. One area that many car buyers look at is using another loan option. There are many loan types available other than the standard principal and interest loan which may help you get your hands on your vehicle faster.

Before you apply for finance, it is important that you research all of the loan types available in the market, see what one works best for you and your financial situation.

Final Word,

Being rejected for a car loan can be a heartbreaking experience, however there are ways you can get around it. The 5 tips mentioned above are a few great ways you can go about gaining finance after being rejected by a bank.

We hope you enjoyed reading this article. To read more articles like this, please visit the Shop for Cars latest news page here.

How Shop for Cars can Help?

Shop for Cars gives car buyers fast and easiest access to over 60 automotive lenders at the click of a button. In a few short clicks, buyers can apply for the cheapest finance loan directly on the vehicle listing that they are interested in. Choose the cheapest rate available and have finance approved in under an hour. No broker, no manual shopping around, fast, easy, car finance.

To learn more about Shop for Cars finance click here or search for a vehicle you’re interested in and choose your options. Fast, easy, simple!

About Shop for Cars,

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DISCLAIMER: This is all based on opinion please research and consult with all relevant parties to make the best loan decision.