How your credit score affects how much you pay for a new car on finance

How your credit score affects how much you pay for a new car on finance

Car finance is for many people the only way of getting a new set of wheels but if you have bad credit, it could end up costing you thousands more for your dream vehicle.

Researchers at comparison and switching service used a finance calculator to work out the cost of buying some of the UK’s most popular cars for different levels of credit score.

The most popular car in the UK is the Ford Fiesta, with more than 1.5 million vehicles registered in 2020, costing £16,645 to buy outright.

When bought on finance, with a four-year repayment period, the total for someone with an excellent credit rating is £20,014.

But it’s a whopping £7,000 more with a bad credit score.

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Happy young man hugging his dream car.

The Ford Focus ranks in second place for popularity, with just under 1.2 million registered last year

Ford’s premium hatchback is more expensive than the Fiesta, with the cost of owning one more than £22,000.

Budding Ford Focus owners with a bad credit score can expect to pay significantly more, in excess of £36,000 in total, which is 35.27% higher than the £26,778 outlay for those with an excellent rating.

In third place in the popularity rankings is the Vauxhall Corsa, with one million vehicles registered in the UK last year.

For drivers with a bad credit rating, the Corsa will cost in excess of £27,000 which is £6,731 more than someone with an excellent rating could expect to pay].

The Mini Cooper – one of the UK’s top 10 most popular cars – is the most expensive car to finance with bad credit, costing £11,527 more than an excellent rating.

The car with the smallest difference in financing price is the Citroen C1, which costs £4,402 more to finance with a bad credit score.’s guide to car credit can be viewed in full here.

Here’s how can you improve your credit score and get a better deal personal finance expert James Andrews said: “Registering to vote, having bills in your name, keeping to 30% or less of your total available credit – per account -and not having a credit history can all impact your credit score.

“When financing a car, first check your credit report to see what your score is. Secondly, check what’s in there and that the information is accurate. Lastly, start taking steps to improve your score.”

Mr Andrews added: “Providing you make your payments on time, don’t apply for many new products in a short period – six months, for example – and keep a stable address, your credit rating should improve.

“In as little as four months you should see your scores start to improve and after a year you should be in a far stronger position.” looked at each of the new cars currently being sold by some of the UK’s most popular car manufacturers.

It also used the latest Department for Transport and Driver and Vehicle Licensing Agency’s vehicle registration data.

The list prices for each vehicle, correct as of April 2021, were sourced from the individual manufacturer websites and run through’s car finance calculator to find out how much would be owed for the different levels of credit score.

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