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7 Tips For A Successful Car Finance Application

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By Author: Belinda Darling
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If you’ve experienced the shock of car finance being rejected, you’ll want to ensure that you put all of the jigsaw pieces in place well in advance of another application! Car finance application outcomes can be predictable … if you know exactly what the lenders are looking for. Today we give you 7 essential preparation tips to ensure your car finance application goes through without a hitch!

1.Check Your Credit File
If there are any unpaid defaults on your credit file, fix them up well before you apply for a car loan.

2.Downgrade Your Credit Card Limit
If your credit card limit is $10,000 (even though your running balance is always zero), lenders count this as a $10,000 debt. This is fair enough, considering it could be at any time! Lowering your limit can help you find success with car finance.

3.Pay Down Debts
Higher debt levels will count against you more than a lack of savings in your car finance application, mostly because debts grow at a much faster rate than savings do. If you have savings, you should either use them to pay down debts, or ... see below!

4.Save a ...
... Deposit
Cars depreciate fairly quickly, and as such there remains a possibility for the lender that if you default on the loan, they won’t recover the full amount. Saving a deposit for your car finance application reduces the risk for the lender. If you’re in a non-standard situation (for example, your everyday expenses are a much lower proportion of your income than for most people), this is an especially handy tactic. Perhaps you live with your parents, grow your own vegies or pack your own lunch every day, and as such you have the capacity to repay a larger loan than someone else with your income. Lenders can’t easily change their maximum loan amount to a higher percentage of your income, but they can take account of a deposit when considering your application.

5.Know Your Pricing
Is the car that you want to finance priced well? If it is overpriced, potentially faster depreciation makes it even more of a risk.

6.Use a Car Finance Broker
They’ll be able to pinpoint potential problems with your application before the lender does, and save you the immense hassle of having a listing for a rejected car finance application on your credit report.

7.Try Again … After a Waiting Period
If you are rejected, it may just be that the car finance company you applied to simply isn’t a good match for your situation! Different companies exist to service the needs of different consumers. A common example is that some lenders will not count overtime as part of your income, even if it is a required part of your job, whereas other lenders will.


How long you wait before reapplying for car finance depends entirely on the reason it was rejected. If it was rejected because of too many house moves, you may have to wait 6 months. If it was rejected because you are in a probationary period at work, wait til the probation has finished. If it was rejected for a policy like not counting overtime, you can try at another lender straight away.


Lowe Finance is a client focused finance and insurance broking business. With specialist
truck finance, equipment finance, car finance and loans all at competitive rates. Look no further than Lowe Finance, your car finance Melbourne specialists.

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