Do Black Horse Finance Accept People With Bad Credit?

Are you worried because you wish to buy a car, but you have bad credit? This is a common concern for many people. Every month, over 12,000 individuals visit this site seeking advice on issues just like this one. 

In this article, we’ll cover:

•  Who Black Horse Finance are and what they do.
•  The meaning of bad credit and how it affects your chances of getting finance.
•  Whether Black Horse Finance can provide credit to people with a bad credit score.
•  Ways to improve your credit score.
•  Other places you can turn to if your credit score is low.

Black Horse Finance is a company that can help you buy a car, motorcycle, or caravan. But they do have some rules. For example, you can only buy from approved shops, and you need a good credit score.

Remember, no matter your credit score, you still have options. We’re here to help you find them.

What Does Black Horse Finance Do?

Black Horse Finance specialises in providing credit for vehicle purchases. You can borrow money from Black Horse Finance to buy a:

• Car
• Motorcycle
• Caravan

There is a but here though. You can only borrow money from Black Horse Finance to spend at one of its approved vehicle dealerships. Whether you are buying a new vehicle or a used vehicle. This means that choices might be somewhat restricted, making it difficult to find the exact vehicle you are looking for. However, the company offers a range of online tools to help you find the right car, motorcycle or caravan.

Will Black Horse Finance Provide Credit to People With a Bad Credit Score?

It is very unlikely that you will be able to get credit from Black Horse Finance if you do have a poor credit score. This is because the company will see you as a higher risk, meaning it is more likely that you will default on the loan.

In some cases that are borderline, the company may offer you finance, but either at an increased interest rate, or with a limit on how much you can borrow. Put simply, they won’t want to lend you as much, and will want to charge more for leading you less.

What Is Bad Credit?

Everyone in the UK has a credit file. This is a list of finance-related transactions and a record of your credit history. For example, when you apply for credit, your credit history is searched to find out your creditworthiness, and a record of this search is kept on your credit file.

Whenever you are provided with new credit, a record of this is made. Additionally, if you are late or miss making a repayment, a record of this is also kept. Therefore, a lender can look at your credit file and judge whether you can be trusted to repay the loan that you are applying for.

Furthermore, certain transactions on your credit file are seen as negative indicators. For example, if the collection of one of your debts has been handed over to a debt collection agency such as Lowell Finance, Cabot Financial or PRA Group. It is the sum of the transactions on your credit file that are used to calculate your credit score.

What Is Considered a Low Credit Score?

There are two main credit agencies in the UK, that lenders can use to query your credit file and get a credit score. These are Equifax and Experian. Each of these calculates credit score differently, but I have checked to find out what is considered a low credit score with both and found the following.

• Experian – 560 to 720 is considered a poor credit score.
• Equifax –  280 to 380 is considered a poor credit score.

In the case of applying for credit from Black Horse Finance, your application would likely not be successful if your credit score falls within these ranges.

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What Can You Do To Improve Your Credit Score?

First of all, if you want to maintain a healthy credit score, you need to pay your debts, you can’t just ignore them. For example, if you owe council tax arrears, this could impact your credit score. Below, I have listed a few things you can do that will make sure that you are doing all you can to improve your credit score.

• Pay off your debts completely, although I understand that getting out of debt entirely can be a challenge.
• Make sure you never miss a payment to one of your creditors.
• Use as little of your available credit as possible. For example, don’t take your credit cards up to the maximum limit.
• Don’t take out any new loans or credit.
• Make any credit applications that result in a hard search on your credit file.

Each and every one of these things will have a positive impact on your credit score. However, it does take time to repair your credit score. Implementing actions such as these will slowly raise your credit score over time, but don’t expect miracles. It could take years to repair your credit score if it was particularly bad to start with. If you want some help and advice on dealing with debts in general, go along to your local Citizens Advice Bureau (CAB). The staff help people with debt in and day out.

Alternatives to Black Horse Finance if You Have a Low Credit Score

There are alternative lenders who specialise in providing bad credit car finance. These are lenders that operate in the subprime market. However, even though you may be able to get vehicle finance from one of these lenders, it might not be the right decision.

Every lender that specialises in providing finance to high-risk borrowers, will charge more interest. This is simply because they are taking greater risks, and it is more likely that the borrower will default on the loan. But for some people, using a specialist lender is really the only option, as they need a vehicle desperately, but their credit score is too low to use a traditional lender. If you are such a person, you need to shop around and find the best deal. Both in terms of the credit agreement and the amount of interest you’ll be charged on the loan.