Finance expert unveil the benefits of joint car finance

Check out this blog to find out all about joint car finance, from what it is to the benefits of taking out a joint loan.

Finance expert unveil the benefits of joint car finance

Buying a vehicle can be challenging and expensive. In fact, more than half of UK drivers (53%) require some financial assistance to purchase a vehicle, with younger motorists being more likely to use car finance.

Things can be even trickier for those with less-than-perfect credit scores. According to Finder UK, about one Brit in five has a poor credit score, meaning they might face stricter requirements when applying for finance. But this doesn't mean there aren't any options to make the process smoother.

For example, joint car finance is an appealing alternative when it comes to taking out a car loan with a low credit rating. But what exactly is it, and how can it benefit you?

Jonathan Such, Head of Sales at vehicle finance company First Response Finance, uncovers the ins and outs of joint car finance while highlighting the advantages of applying for this type of loan if you have a poor credit ranking.

Joint car finance: what is it?

First things first, joint car finance is when two people who live together – whether it's partners or family members – apply for a car loan.

When doing so, the finance provider will evaluate both applicants' income, financial circumstance, and – more importantly – credit score, making a decision based on their combined situation.

Such said: "Generally speaking, joint car finance is a valuable solution for a driver who wants to increase their chance of gaining access to a car loan. This is especially true if you have a low credit score.

"Bear in mind that the main applicant will be the registered keeper of the vehicle and have all the relevant car documents.

"However, both applicants can use and share the motor as they please, as long as they have the right licences and insurance."

As well as helping you jump behind the wheel of a car with more ease, joint car finance comes with a number of other valuable advantages. Here are some noticeable ones that are worth taking into careful consideration.

Improve eligibility

As mentioned, one of the most appealing benefits of opting for joint car finance is that it can improve your chances of getting approved for a loan.

Such explained: "When you apply for car finance together with a partner or family member, you might be able to increase your eligibility.

"In fact, should your fellow borrower have a more positive credit rating, it can have a positive impact on the application process.

"This is particularly useful if you currently have a poor or limited credit history, as the finance provider is more likely to approve the joint loan based on the stronger applicant's credentials."

Offer shared responsibility

With joint car finance, from a credit file point of view, borrowers are all equally responsible for paying back the loan.

When it comes to car finance, it's still the main applicant who's expected to take care of and stick to monthly repayments. Yes, both borrowers can drive the car as long as they're insured, but the registered keeper of the vehicle is still the one officially responsible for respecting the loan agreement.

This said, applying for car finance with another person can offer more peace of mind.

Such added: "As well as giving you more confidence, applying for a joint loan can reassure the lender that – between two or more people – you will be able to keep up with the payments.

"There is one thing to bear in mind, though. Because everyone is equally liable from a credit file's perspective, if one person misses their instalment, it might have a negative impact on the credit score of both borrowers.

"So, make sure to always communicate with your partner or close relative, reviewing together whether you might need a hand to pay up your monthly rate."

Boost your credit score

If you currently have a less-than-perfect credit score, opting for joint car finance might help you build a more solid credit history.

In fact, regardless of whether you're paying your bills alone or with someone else, showing that you keep up with instalments can work wonders on your credit score.

Timely repayments on your joint car loan are likely to positively impact the credit profile of all applicants, making it even easier to access finance in the future when needed.

What happens if your situation changes?

Whether you expect them to or not, sometimes circumstances in life can change from one day to the next.

For example, you may split up with your partner or suddenly witness a decrease in your income, especially if you're changing or have left your job. These can be stressful situations, but they can cause even more headaches if you have a joint car loan.

Such said: "Should your sentimental or financial situation change and you're worried about how to manage your joint car loan, the best option is to get in touch with your vehicle finance provider as soon as possible.

"Finance providers have the responsibility to help everyone to the best of their ability, so they'll no doubt try and find a solution that suits all parties involved.

"Leaving your partner or suddenly earning less money are challenging scenarios. If you're struggling with your instalments, make sure you don't suffer in silence and reach out for support. Your lender will be on hand to help you navigate this moment of personal crisis."


Ultimately, joint car finance can help you purchase a car despite currently having a low credit score.

From improving your eligibility to boosting your credit rating and giving you more confidence and peace of mind, there are plenty of good reasons to consider applying for a joint loan to fund your vehicle.

Press releases | 14.06.24

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