Finding a new car is never a completely straightforward process. Not only do you need to figure out which kind of car suits you best, but then you have to actually find an affordable and manageable way of buying the car that you want. This is made even more complicated if you have personal finance issues that could stand in the way of your application for car finance. Applying for car finance while you are navigating a debt management plan, for example, is something that many people simply don’t attempt because they don’t think they will be able to have an application accepted.
If you have had difficulty managing your finances and credit and now find yourself under a debt management plan (DMP), then you probably know that this can make finding a manageable car finance agreement difficult. The good news is that it is not impossible – it simply means searching for a lender that specialists in bad credit car finance.
Having a debt management plan (DMP) makes finding good car finance more difficult, but not impossible. While most lenders will be unable to help you, some specialist lenders will work alongside you to understand your needs.
Factors you need to consider:
To apply for car finance while under a DMP, you will need to prove to your DMP provider that the car is a necessity. To do so, think about the following:
- Where do you live? Location can play a big factor in this. For example, if you live in a very rural area, you may find yourself secluded without a car. If your home isn’t close to any useful transport results and you rely on a car to go shopping, commute, and simply run a normal life, a car may be deemed a necessity.
- Do you commute to work? For most drivers, the daily commute is by far the most use they get out of their car – especially if you are driving long distances to work. If this sounds like you, then there’s a good chance that you will be able to persuade your DMP provider that having a car is a necessity to keep earning – something that supports your debt management plan.
- Do you have children? Next to the daily commute is the daily school run – a huge priority for any household with children. If you have dependents that need to get to school, your car may be seen as a necessity.
- Do you suffer from any health problems? Health issues that affect your ability to get around or use public transport will be taken into account as part of your debt management plan, and can make having a car a requirement.
- Can you manage additional costs? The actual cost of the car itself is just one of many expenses that you need to take into account. Everything from insurance and road tax to fuel money, your MOT, parking fees and more should be part of your calculations.