Auto Refinance For Fair Credit

What Is Fair Credit?

Fair credit describes customers in the mid-range of credit. Although numbers differ between credit reference agencies, fair credit customers don’t meet high criteria, but are also too strong for low to bad-credit options.

Refinancing – Quick Definition

Refinancing is swapping out an existing car loan, potentially to lower payments, change the loan duration, or even upgrade your wheels (if you’re in positive equity).

Can I Refinance My Car With Fair Credit?

Yes, you can refinance your car with fair credit, just be aware that interest rates will be higher than those with a stronger credit score. Before taking the step into refinancing, consider the following factors.

Can You Actually Afford The Loan?

Refinancing might lower your monthly payments, but it could also increase them, or extend the loan term, meaning you pay more interest overall. Don’t use refinancing as a quick get-out-of-jail-free card; you could be caught out down the line.

Is Your Car Worth Enough?

The value of your car (equity) has a big impact on the refinance terms on offer. Be aware that lenders typically require you to have enough equity to refinance.

Depreciation

Depreciation is when a car loses value over time. In refinance agreements, depreciation is an important factor, as it can limit how much equity you have, subsequently affecting the refinance terms available.

Credit Score Impact

Refinancing will cause an initial credit score dip, but over time this will improve, provided you make repayments.

The Pros And Cons Of Refinancing

How Important Is A Credit Score For Car Finance?

Credit score is a massive factor in car finance, affecting approval chances, interest rates, deposit requirements and the amount you can borrow. Your credit score is used by lenders to work out where you sit in their affordability range and whether car finance is even possible. If you have a higher credit score, you are seen as lower risk and more likely to not only be accepted but also receive lower interest rates.

Learn more about the impact of credit scores on car finance here.

Does Refinancing Help My Credit Score?

When you take out refinancing, your credit score may dip initially, but it will recover and potentially improve over time, provided you make on-time repayments. If you’re struggling to keep up with finance payments, refinancing can be a good way to downsize your agreement and avoid future credit score penalties through missed payments.

Looking to refinance? Get a quick, no-obligation affordability check with no impact on your credit score.

How Can I Improve My Chances Of Getting Auto Refinance With Fair Credit?

To boost your chances of refinancing with fair credit, look to improve affordability and, in doing so, make yourself as low risk as possible to potential lenders. Here are some practical tips to improve your chances of auto refinance with fair credit.

✅ Fix Any Credit Score Errors

Check your credit report monthly to ensure any errors or issues are removed or corrected.

✅ Keep Your Credit Utilisation Low

Lenders see multiple credit applications and commitments as risky. Avoid applying for refinancing whilst having existing credit commitments.

✅ Collect Proof Of Financial Strength

Lenders will require proof of financial capability through utility bills and pay slips. Make sure you have this proof, as well as bank statements to boost your chances of fair credit finance approval.

✅ Use Soft Searches When Applying

Soft credit checks don’t show up on lender radars, helping you check your affordability without hurting your chances of future approval. Apply with soft credit check lenders to avoid future issues if approval isn’t received.

Check your eligibility without affecting your score with Marsh Finance.

Marsh Finance – Supporting Fair Credit Customers For Over 50 Years

Marsh Finance have supported fair credit customers for over 50 years, building specialist finance products and support in line with fair credit customer needs. Instant decisions with no credit score impact help you get an initial idea of how finance could look whilst still protecting your score.

Quick Eligibility Check – No Obligation – Soft Credit Check

Marsh Finance provides refinancing solutions to existing and new customers, with a commitment to looking beyond credit scores. For you in the fair credit range, this provides a massive boost to your approval chances vs traditional lenders. So, what are you waiting for? Check your chances of refinance today without affecting your credit score.