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What Counts as Bad Credit?
Bad credit generally means your credit score is below average due to missed repayments, defaults, bankruptcy, or too many credit enquiries. Lenders see this as higher risk, which can affect your loan approval and the interest rate you are offered.
Can You Still Get Approved?
Yes, in some cases you can. Approval will depend on:
- Your current financial position – Showing stable income and manageable expenses helps.
- The lender’s criteria – Some lenders specialise in car loans for bad credit.
- The type of vehicle – Lenders may prefer newer, lower-risk cars.
How a Perth Finance Broker Can Help
Instead of applying directly with one lender, a finance broker in Perth can access a wide range of lenders and match you with the one most likely to approve your application. They can:
- Negotiate better terms
- Minimise the impact of multiple credit checks
- Help you present your application in the best light
Tips to Improve Your Chances
- Pay down any outstanding debts before applying
- Avoid applying for multiple loans at once
- Provide as much proof of stable income as possible
Bottom line: Bad credit does not have to mean no car. With the right car finance strategy and the help of an experienced Perth finance broker, you may still get behind the wheel sooner than you think.
Blog 2: How Much Can I Borrow for a Car Loan? A Practical Guide
If you are shopping for a new or used car, one of the first questions you will have is: How much can I actually borrow? The answer depends on several factors, and working with an experienced Perth finance broker can help you find out quickly.
Key Factors That Affect How Much You Can Borrow
- Your Income and Expenses: Lenders will look at your monthly income, minus living expenses, to determine how much you can comfortably repay.
- Your Credit Score: A good credit history can increase your borrowing power and help you secure lower interest rates.
- Loan Term: Longer terms may lower monthly repayments but could increase the total interest paid.
- Deposit Size: A larger deposit means you will need to borrow less, making approval easier.
- The Vehicle Itself: Lenders often prefer newer vehicles, as they hold value longer.
How a Perth Finance Broker Can Help
A car finance broker in Perth can:
- Compare options from multiple lenders
- Calculate your borrowing power accurately
- Find competitive car loan rates to match your budget
Quick Borrowing Power Estimate
While every lender’s criteria differ, a general rule is you can borrow an amount where your repayments do not exceed 20 to 30 percent of your monthly income. For example:
- Monthly income: $5,000
- Comfortable repayment range: $1,000 to $1,500 per month
From here, a broker can run the numbers to show exactly what this translates to in car loans.
Final tip: Do not just focus on the maximum you can borrow. Focus on what is comfortable for your lifestyle. An experienced Perth finance broker can help you secure the right loan amount and avoid financial stress.
