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Car finance affordability checks

What checks and processes are in place to make sure your car finance is affordable?

Making sure your car finance is affordable

Before starting a finance agreement, an important factor is making sure that what you are signing up for is affordable. Credit reference agencies and the finance company can help with the process.

Determining affordability

If you're looking to buy a new car on finance you will have to go through various checks with the finance provider.

You will have to provide some personal details, such as:

  • DOB
  • Address history
  • Driving licence details
  • Employment history

The finance company will then look into your credit history and decide whether you can afford the monthly payments.

The credit application process is designed to protect you, not just the finance company. The process for a credit application can be relatively quick and enables the finance provider to determine whether financing this particular car is in your best interests. The Financial Conduct Authority (FCA) has strict rules to ensure that all finance companies lend responsibly.

Remember, if your circumstances do change it is advised that you speak to the finance company as soon as possible, as they may be able to help.

Affordability Passport

Some finance providers will require further information to review your application. This can be requested with an Affordability Passport in order to keep your personal details secure.

For more information on how VWFS uses this service, please click the link below.

 

More about Affordability Passports