Hello Mabs
I earn a decent salary and can afford the monthly repayment, but my vehicle finance application was declined. I'm embarrassed because I don't understand why. What exactly does the bank look at when deciding whether to finance a car?
Mabs answers:
Please don't be embarrassed. Being able to afford an instalment in your own calculations doesn't automatically mean a lender will reach the same conclusion.
Vehicle finance providers look at several things, including your income, existing debt, monthly expenses, credit history and how reliably you've managed previous credit. They also have to assess whether the proposed finance is affordable for you.
Before applying again, get a copy of your credit report and check that the information is correct. Look at your existing commitments too. Reducing smaller debts can sometimes improve your affordability.
And please resist making applications everywhere at once because you're desperate to get the car. A declined application isn't a judgement on you. Understand why it happened first. Then work on what you can change before trying again.
