📉 Do Missed Payments Affect Car Loan Approval?
Yes! If you have late or missed payments on your credit report, lenders may view you as a high-risk borrower, making car loan approval more difficult.
Your approval chances depend on:
✅ How recent and frequent the missed payments are
✅ Whether the debt has been settled
✅ Your overall credit score and financial stability
If you’ve had just one or two late payments, some lenders may still approve you—but multiple missed payments make it harder to qualify.
🔍 How Lenders View Missed Payments on Your Credit Report
Lenders assess the severity and timing of missed payments before making a decision.
| Type of Missed Payment | Impact on Car Loan Approval | How to Improve Chances |
|---|---|---|
| ✅ One late payment (under 30 days) | Minimal impact if it was an isolated case. | Keep repayments up to date moving forward. |
| ⚠️ Multiple late payments in 12 months | Moderate impact—some lenders may decline. | Show at least 6-12 months of on-time payments before applying. |
| ❌ Default (unpaid for 60+ days) | Major impact—most lenders will reject you. | Pay off the debt and request a clearance letter. |
| ❌ Multiple defaults or overdue accounts | High risk—only specialist lenders will consider you. | Work on rebuilding credit before applying. |
If you have missed payments but no defaults, some lenders may still approve your car loan under stricter conditions.
✅ How to Get a Car Loan If You Have Missed Payments
If you have late or missed payments on your credit report, follow these steps before applying for a car loan:
1️⃣ Check Your Credit Report – Ensure there are no incorrect listings or reporting errors.
2️⃣ Settle Any Overdue Debts – Pay off outstanding debts to improve your creditworthiness.
3️⃣ Show a Recent History of On-Time Payments – Lenders prefer applicants with at least 6+ months of good repayment history.
4️⃣ Consider a Secured Car Loan – Using the car as collateral reduces lender risk.
5️⃣ Use a Finance Broker – A broker can find lenders that approve applicants with past missed payments.
Even if mainstream banks reject your application, specialist lenders may still approve you with adjusted terms.
🚨 Can You Get a Car Loan with an Unpaid Default?
It’s very difficult, but not impossible. Some lenders may approve your loan if:
✅ You settle the default first and provide proof of payment.
✅ You have a stable income and minimal other debts.
✅ You apply with a guarantor or higher deposit.
If you have an active unpaid default, most lenders will not approve a car loan until it is resolved.
🚀 Why a Finance Broker Can Help If You Have Missed Payments
If your car loan application was rejected due to late payments, a finance broker can help by:
✅ Finding lenders that accept applicants with past missed payments.
✅ Matching you with a loan that suits your financial situation.
✅ Helping you avoid unnecessary credit checks that lower your score further.
If you’ve missed payments but need a car, don’t risk rejection! 🚗💨 A finance broker can help you secure finance with the right lender.
If you have missed payments on your credit report but need a car loan, you still have options! A finance broker can match you with lenders who approve finance despite past late payments.
DISCLAIMER
The information provided on this website is general in nature only and has been prepared without considering your financial needs, circumstances and objectives and should NOT be construed as financial, taxation or legal advice. For more information, get in touch with our experienced partner brokers today.
