If you're considering a car loan to pay for your next car, you may be wondering how much of a deposit you may need - or can I purchase this car with No Deposit Finance. This is a common question we are asked at Dave Allen Motors, so to help make things a little clearer here’s what it can depend on.
As a general rule, you may be asked to provide a deposit if you -
Have bad credit history
If your credit history shows that you have failed to repay loans in full or have gone bankrupt, banks and finance companies will be less willing to lend you money without a deposit to help offset the risk. In other words, you should expect that you will be asked for a deposit.
Don't have any credit history
If you've never had any finance before, chances are you will need to pay a deposit. Here's why - As a customer with no finance history, car finance companies are not able to look at your history of loan repayments to judge your track record. They don't know that you will pay back your loan without having any issues, so they will typically ask for a deposit on the loan to offset the perceived risk of lending to you.
Have negative equity on your current car
If you have taken out a car loan in the past, and the value of the car has fallen below the outstanding balance of the loan, you will be considered to be in negative equity. This can happen when the value of your car is dropping faster than the pay-out amount of the loan, or maybe your vehicle has been in a accident and you have not had sufficient insurance.
The good news is Dave Allen Motors has options that can work to structure a loan with negative equity and from no deposit. Here at Dave Allen Motors we specialize in No Deposit Finance, we use all the major car finance companies to make sure we get the best possible car loan deal for you. For example, we have helped countless customers who are on a benefit buy a car with no deposit finance.
To find out whether or not you qualify for no deposit finance, or if you are looking to find a low deposit option, give us call on 0800 227000 or get an online quote before you get started, it’s free and only takes a few minutes.
We look forward to talking to you soon.