Top 5 tips to get approved for truck finance with bad credit

Published on November 26th, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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Check your credit report

Firstly, you need to request a detailed credit report, even though you have bad credit. Most of the times, people with bad credit end up overpaying for auto loans because they assume it’s much worse than it actually is. This is why you shouldn’t settle for an offer before getting acquainted with the detailed situation of your credit.

In case you notice errors with your credit report, make the necessary adjustments in order to correct them. This will imminently improve your credit situation. In certain cases, the assistance of a finance expert is a necessity, to aid you perform your credit’s report needed corrections.

Consider saving up money for down payment

If you have bad credit, the majority of lenders will require a larger down payment. As a matter of fact, whether you are able to provide a down payment or not carries a lot of weight in getting approved for truck finance.

This is why you should consider saving up money if you’re thinking of obtaining a truck loan. This will put you in a more favourable light, and will raise your chances of receiving an offer. The worse your credit situation is, the larger the down payment should be. Normally, it should consist of at least 10 percent of the truck’s worth.

Shop for an auto loan

When shopping for an auto loan, you should know that lenders will pull your credit report, which equals an inquiry. Unfortunately, this can have a detrimental impact on your credit score. The downside is that as the number of inquiries grows, your credibility will be significantly diminished. This is why you should try to limit the auto-shopping, in an attempt to deter that from happening.

Having a co-signer

Having a co-signer can significantly raise your chances of getting approved for truck finance. This means that this person is willing to borrow the money with you. As a matter of fact, if your credit is really bad, having a co-signer is literally a necessity. Even with a co-signer, you’ll have to qualify for a number of income requirements.

Opt for a newer vehicle

Opting for a newer vehicle can help you obtain a better deal. Used vehicles often equal higher interest rates, as well as high environmental taxes. Nonetheless, if you’ve come across a very profitable alternative for a used vehicle, it’s a good idea to consider that option.

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This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

Approval for commercial loans is always subject to our lender’s terms, conditions and qualification criteria. Lenders will undertake a credit check in line with responsible lending obligations to help determine whether you’re in a position to take on the loan you’re applying for.

The interest rate, comparison rate, fees and monthly repayments will depend on factors specific to your profile, such as your financial situation, as well as others, such as the loan’s size and your chosen repayment term. Costs such as broker fees, redraw fees or early repayment fees, and cost savings such as fee waivers, aren’t included in the comparison rate but may influence the cost of the loan. Different terms, fees or other loan amounts may result in a different comparison rate.

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