Can You Get Car Finance with a CCJ?

If you have a County Court Judgment (CCJ) on your record, finding car finance can feel difficult. However, there are bad credit car finance options available that can help you get behind the wheel despite past credit issues.

This blog will help you understand how a CCJ affects your chances of getting car finance and the steps you can take to improve your chances of approval.

What is a CCJ?

A CCJ, or County Court Judgment, is a legal decision made when someone owes money and hasn’t paid it back. It’s recorded on your credit file and shows lenders that you have unpaid debts. A CCJ appears on your credit file for six years from the date it was issued,

How does a CCJ impact your ability to get car finance?

A CCJ can significantly impact your ability to get car finance because it lowers your credit score and signals to lenders that you may have struggled with debt repayments in the past. This makes you a higher risk borrower in their eyes.

When lenders review your application, they’ll look at your credit report to assess how reliable you are at repaying borrowed money. Most mainstream lenders have strict criteria and often refuse applications from people with recent or unpaid CCJs. They prefer borrowers with a clean credit history, as this suggests a lower chance of default. Even if they do consider your application, they might offer finance with higher interest rates or less favourable terms to compensate for the increased risk.

That said, some specialist lenders are willing to work with customers who have CCJs, especially if the judgment is older or has been paid in full. These lenders can offer tailored car finance options which are designed for people with less-than-perfect credit, although usually at higher costs.

Overall, a CCJ doesn’t automatically rule out getting car finance, but it does make the process more challenging and can limit your options.

What types of car finance are available with a CCJ?

Although it can be more difficult, you will still have options for getting car finance if you have a CCJ. Different types of car finance will work better depending on your credit situation.

Specialist lenders and bad credit car finance

If you have a CCJ, your options with mainstream lenders can be limited. However, specialist lenders focus on people with bad credit, including those with CCJs. These lenders understand the risks and offer car finance products designed to help you get back on track. The interest rates may be higher, but these loans can be a good way to rebuild your credit history.

Personal contract purchase (PCP) vs hire purchase (HP) options

With a CCJ, you might find it easier to get finance through hire purchase (HP) agreements rather than personal contract purchase (PCP). HP lets you pay off the car in fixed monthly payments and own it outright at the end. PCP usually involves lower monthly payments but requires a large final payment to keep the car, and it can be harder to get approved if your credit isn’t strong.

Secured vs unsecured car finance

Secured car finance means the loan is backed by the vehicle itself. If you miss payments, the lender can take the car back. This type of finance can be easier to get with a CCJ because it reduces the lender’s risk. Unsecured car finance doesn’t use the car as security and can be harder to obtain if you have a CCJ, as lenders see it as riskier.

How can you improve your chances of getting car finance with a CCJ?

You can take steps to help improve your chances of getting car finance with a CCJ. This can help you to address the judgement and strengthen your finances, showing lenders that you can manage your repayments responsibly.

Steps to address or settle a CCJ

You should aim to pay off the CCJ as soon as possible. If you settle the debt within one month of the judgment, it will be removed from your credit record entirely. If you pay the CCJ after one month, it will be marked as ‘satisfied’ on your credit file, which looks better to lenders than an unpaid judgment. In some cases, you can apply to have a CCJ set aside if it was issued incorrectly, which can also improve your credit standing.

Building your credit score after a CCJ

You can register on the electoral roll to help lenders verify your identity and address, which will improve your credit profile. You should aim to make all payments on time, whether for utility bills or credit cards, to help rebuild your credit score. It’s also important to avoid applying for multiple credit products in a short period, as this can lower your score further. Using a credit-builder card responsibly can demonstrate good repayment behaviour and gradually improve your credit rating.

Importance of affordability and documentation

Lenders want to see that you can comfortably afford the repayments, especially if you have a CCJ. You can provide proof of income and outgoings, such as bank statements and payslips, to support your application by showing your stable finances. You should always be honest about your credit history from the start to build trust and prevent issues during the credit check process.

Why choose Get Car Finance Here for car finance with a CCJ?

GetCarFinanceHere specialises in helping people with CCJs secure car finance by connecting them with specialist lenders who understand your situation. We offer tailored finance solutions that suit your individual needs and budget, helping to increase your chances of approval. Throughout the process, our expert team provides clear advice and support, guiding you every step of the way to make the experience as smooth as possible.

Apply for car finance online today or contact us for more information.