Car finance for unemployed people

How does unemployed car finance work

You might imagine that if you don’t presently have a job, it won’t be possible for you to get approved for car finance. However, this isn’t necessarily the case. After all, unemployed people do often need a car in order to get around, including to meet friends and family and/or attend job interviews.

Here at Car Finance Genie, we are a broker working alongside a panel of trusted lenders. This puts us in a strong position to try and provide unemployed people – perhaps someone like you – with a car finance deal that they can afford, and which enables them to get behind the wheel of the right car.

How we work.

Car finance made easy with 4 simple steps

1

Apply

Ready for a new car? Get a no-obligation finance quote. We consider most credit situations and have access to a wide panel of lenders, so we can find a car finance option which suits you

Apply now

Your car finance application

2

Get decision

We compare our panel of lenders and our experts will be able to outline the best options available to you if approved

3

Choose a car

With hundreds of trusted quality used cars available from our carefully selected dealers, your dedicated Genie will be on-hand to help find the right car for your needs and budget

4

Drive away

Wish granted. Complete all of the required documents and get the keys to your new car

Frequently asked questions 

You are in a particularly unusual situation if you are looking to apply for car finance while unemployed. Your unemployment will have implications for your attempt to fund a new car in this manner, which is why we have provided answers to the following frequently asked questions.

Which car finance is right for you?

The good news is that your unemployment doesn’t necessarily rule you out of securing finance for a car. That’s because lenders will judge you on a range of factors — rather than just your job status alone – when trying to decide whether to offer you a car finance deal. 

Those factors include your financial circumstances unrelated to your job, while your credit rating will also have a major influence. Your age will be another factor, as older applicants tend to be more financially stable than their younger counterparts.

The bad news, however, is that your unemployment will inevitably impair your chances of landing a car finance deal, or at least one on terms favourable to you. We cannot provide any guarantee that we will be able to get you a car finance deal.

We do, however, work with numerous different lenders in order to increase the likelihood that you are indeed offered car finance via Car Finance Genie. We also always ensure that, for each successful applicant, we present them with the best possible deal we have been able to find.

Most of the car finance products we offer fall into one of two categories: hire purchase (HP) or personal contract purchase (PCP). We can advise you on each of these options – as well as specific deals you are offered – so that you can more easily choose between them.

What is hire purchase (HP)?

This is an especially popular type of car finance. Once you have agreed to a hire purchase deal, you will be handed a loan that is secured against the car – meaning that you won’t own the vehicle until this loan has been fully paid off.

You will pay off this loan by making monthly repayments over the course of the loan period – the exact length of which will be specified from the start, as will the size of each loan repayment. After the loan period has elapsed, you can rejoice in now owning the car outright.

Given how financially stricken you could be as a result of your unemployment, the HP route could appeal for several reasons. One is that you will not strictly need to pay a deposit beforehand, although you could choose to pay one anyway to help generate better terms for yourself.

You could also take great comfort from knowing that no unexpected charges apply with HP, and you will not need to make any final lump sum payment – also known as a ‘balloon’ payment – just to secure ownership of the vehicle. Instead, that vehicle will simply become yours as the loan period expires and all payments are made.

A HP deal would, however, enable you to make one-off payments – or even pay off the entire agreement – well ahead of that time.

What is personal contract purchase (PCP)?

This form of car finance has many similarities with hire purchase. In both instances, the loan is secured against the vehicle, and the amount you repay on a monthly basis will stay fixed throughout the loan period. However, something different does occur at the end of this period…

Basically, when the loan term ends, the car doesn’t automatically become yours. You do, however, have a lot of choice over what happens to the vehicle.

You could opt to keep it by paying a ‘balloon’ payment. One alternative option, though, would be to hand the car back – for example, in exchange for a different one, if you wish. Any positive equity you have built up can be used as a deposit in a new car finance deal.

PCP also differs from HP in the sense that the former can potentially offer lower monthly payments. This prospect could obviously be attractive to you if your unemployment means that you have relatively little income trickling through to you regularly.

Nonetheless, to unlock those lower payments, you could be required to agree to annual mileage limits. These restrictions might not exactly be a deal-breaker for you if you don’t anticipate using your car for much more than occasional travel, such as to attend job interviews.

What kinds of vehicles can I buy?

Due to our partnerships with numerous carefully selected dealers, we could offer vehicles that are impressive in both variety and quality. These cars number in the hundreds, and can be perused online through the Car Finance Genie website.

Hence, when looking through the vehicles we have in stock, you are likely to find some that are especially to your liking. The big-name automakers represented in the selection of cars we have available include Ford, Nissan, BMW, Audi, Mercedes-Benz, and many more.

If you are yearning for a particular type of car – or even a specific model of car – but can’t find it in our current stock, just let us know. We have an expert vehicle sourcing team capable of finding cars adhering to specifications provided to us by car finance applicants.

Can I get finance if I have a bad credit history?

As made clear above, we are unable to guarantee you a car finance deal – and this certainly remains applicable if you have a poor credit history. However, we are committed to working as hard as possible in attempts to help people with finding the car finance they are looking for.

It could reassure you to know that, if your credit history is indeed negative, you would stand a better chance of securing car finance by approaching us rather than many of our competitors.

This is on account of the strong relationships we have forged with lenders that specialise in providing car finance to people with your kind of credit history.

We believe strongly that car finance should be available even to those with more challenging personal or financial circumstances. This is why, when you apply through us for car finance, we will do everything possible to find a suitable deal for you.

Please note, however, that the lenders we work with have a duty to lend responsibly, such as by making sure they do not lend to people who would be unable to make the pre-agreed repayments.

For this reason, a negative credit score could indeed make lenders think twice about lending to you. However, you could increase your likelihood of approval by mentioning a guarantor on the application, as this guarantor would ideally be someone who has a good credit rating.

It could also reassure you to know that, once you have successfully sourced car finance with help from Car Finance Genie, keeping up with repayments could help you improve your credit score – and consequently make it easier for you to obtain car finance again further down the line. (its important to note this will only happen if you also keep up to date with other credit commitments).

While it is impossible for us – or any other sensible broker – to guarantee car finance for unemployed people, rest assured that neither unemployment nor an adverse credit score necessarily has to bar you from eligibility for car finance.