How To Get a Car Loan With Bad Credit in NZ

Wanting to get a car loan but have bad credit?

Its not the end of the world and it is possible to get a Car Loan With Bad Credit in NZ, you just need to prepare yourself well and don’t expect to get the best car loan interest rate available.

First of all, it will help for you to understand why a lender is less likely to approve your car loan application, and then we can go over the steps to help you get your finances in as best shape as possible. 

back to top

Why won't a Lender give me car finance with bad credit?

Basically you are viewed as high risk and there is more chance you will miss repayment dates and default on your loan.

If you have slipped up in the past when paying off a loan, Hire Purchase, After Pay etc this will go on your record and when a new lender does a credit check, warning bells will ring and the lender will need to decide whether you are too higher risk to proceed with your application or not. 

Your current financial situation will be a key factor in your success so the better prepared you are, the more likely you will be of securing a car loan.
back to top

Low car finance interest rate application

See if you qualify for an Interest Rate of 5.99%

Get pre-approved today with Simplify Car Finance and you’ll be one step away from your next car!

How can I prepare myself financially before applying for a car loan with bad credit?

Before you apply for a car loan with bad credit, it is best to have the following 5 things in as best order as possible so the lender won’t see you as too much of a financial risk.

  1. Bank account. Make sure your personal bank account is not in overdraft and that you can show over 3 months of bank statements that your income exceeeds your expenses and you have enough money left over each week to afford your repayments PLUS any unexpected costs that may arise from your car or other day to day expenses.
  2. Full time job or regular part time job.  When you have bad credit and are applying for finance, you are looked at as higher risk and have less stability than someone with good credit. You need to demonstrate to the lender that you have moved on from your financial trouble in the past and have a steady income. It doesn’t need to be full time, but regular income. This will demonstrate stability and help you show your income exceeds your expenses.
  3. Repay any outstanding debts. Make sure you have repaid all outstanding debts. This will help clean up your record and also mean your weekly/monthly expenses are lower. You can check your credit score and make sure there isn’t any unexpected debts you didn’t know about. If there are you can get them repaid or dispute them if there are any errors.

    Get your credit score report for free on any of these websites:

  4. Credit Cards. Pay off your credit cards! The less monthly expenses you have the better your financial situation will look to the lender.
  5. Save a deposit. Saving for a deposit (minimum $1000 ideally) is an important step in preparing for a car loan, especially when you have bad credit. By saving you are demonstrating your income exceeds your expenses, it demonstrates you can manage your finances well and it also means you are not taking out such a big loan so it saves you interest and the total repayment amount is reduced.

    A deposit gives the lender more peace of mind and it will also make you feel better about applying for your loan, knowing you have saved for it and are managing your finances better. 

If I get approved will I get a good car finance interest rate with bad credit?

You won’t likely secure the best interest rate no. But there are things you can do (numbered above) to help you get the best car finance interest rate possible for your situation.

So lets face it, you’re probably not going to get a car finance interest rate less than 9%. If you don’t prepare yourself properly however and are successful in securing a car loan your interest rate could be higher than 16% which will hurt you financially in the long term and increase your weekly/monthly repayments.

If you can prepare yourself financially following our recommendations your interest rate could be more likely around 8-12%, saving you money and making your life a lot easier.

New Zealand Car Finance Providers

Get car finance quotes from multiple lenders and compare your interest rates. Your quotes from these lenders won’t affect your credit score so shop around and find the best rate for your financial situation

Simplify Car Finance

We make finance easy

• Quote in 2 minutes
• From 6.5%
• Unsecured Loan
• No early repayment fees
• A++ service & reputation

Lending Crowd Car Finance New Zealand

The clever new way to borrow money

• Peer to peer lending
• From 5.03%
• Secured Loan
• No early repayment fees
• Finance anything with wheels!

Stadium Finance Compare Car Finance New Zealand

Wheel get you a great deal!

• 100% online
• From 7.95%
•Decision in 24hrs
• Min Earn $500/wk
•Secured car loan

CarFinance2U Low Interest Rate Car Finance New Zealand

Quick Approval, Low Interest Car Loans

• 100% online
• From 8.95%
•No deposit finance
• Min Earn $500/wk
•Bad credit finance ok

Unsure Who You Should Get A Quote From?

Let Compare Car Finance do all the hard work for you and match you with a local lender ready to approve car finance for you today. Get Started Now!

Compare Car Finance New Zealand icon

See if you qualify for car finance at 6.95%

Search Thousands of Cars Available For Finance Right Now!


Please complete your details below. We'll give you a callback to answer any questions you may have and proceed with your vehicle finance application.

Apply Contact