How a bad credit score can cost drivers dearly
Having a bad credit score could cost you up to £ 8,000 more to finance one of the UK’s most popular cars, according to a new study from Uswitch.com.
For example, the best-selling Ford Fiesta costs £ 16,645 to buy outright. However, when purchased on finance with a four-year payback period, the total for someone with an excellent credit rating is £ 20,014 – or £ 7,059 more (£ 27,073 in total) for a driver with a bad credit rating.
The data was obtained by the compare and change service using an auto finance calculator to determine the cost of 10 cars bought on finance for motorists with different levels of credit.
Cost of financing the 10 most popular cars in the UK
|Popularity ranking||Car model||List of prices||Financial cost with an excellent credit rating||Financial cost with a fair credit score||Financial cost with bad credit||Difference between excellent and bad credit|
|1||Ford Fiesta||£ 16,645||£ 20,014||£ 23,673||£ 27,073||£ 7,059|
|2||Ford Focus||£ 22,215||£ 26,778||£ 31,672||£ 36,221||£ 9,443|
|3||Vauxhall Corsa||£ 16,815||£ 20,269||£ 23,974||£ 27,417||£ 7,149|
|4||Volkswagen Golf||£ 23,360||£ 28,158||£ 33,305||£ 38,089||£ 9,931|
|5||Vauxhall Astra||£ 19,185||£ 23,125||£ 27,352||£ 31,281||£ 8,156|
|6||Volkswagen Polo||£ 17,355||£ 20,920||£ 24,743||£ 28,298||£ 7,378|
|7||BMW 3 Series||£ 32,595||£ 39,290||£ 46,471||£ 53,147||£ 13,857|
|8||Nissan qashqai||£ 23,555||£ 28,393||£ 33,583||£ 38,407||£ 10,014|
|9||Toyota yaris||£ 19,915||£ 24,005||£ 28,393||£ 32,472||£ 8,466|
|ten||Mini Cooper||£ 27,115||£ 32,684||£ 38,658||£ 44,211||£ 11,527|
Plan ahead for a better credit score
James Andrews, Personal Finance Expert at Uswitch.com, Reveals How To Improve Your Credit Score To Help You Get The Best Deal When Buying A Car On Finance: “Register to Vote, Get Bills on your behalf, keeping 30% or less of your total available credit (per account) and lack of credit history can all have an impact on your credit score.
“When financing a car, first check your credit report to see what your score is. Second, verify what’s in there and that the information is correct. Finally, start taking action to improve your score.
“If you make your payments on time, don’t apply for a lot of new products in a short period (say six months), and keep a stable address, your credit rating should improve. In just four months you should see your scores start to improve and after a year you should be in a much stronger position. “