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Car finance ›
Can pensioners get car finance?
Updated: Friday, 24 November 2023
Whether you’re in full-time employment or retired and living off a pension, paying for a new car in one lump sum isn’t always possible.
In this guide, we look at how car finance for pensioners and retirees works in the UK and the factors which could affect your eligibility for credit later in life.
Can you get car finance if you're retired?
It’s a common misconception that you must be in regular employment to purchase things on finance. In reality, you just need to be able to prove that you have a source of regular income, be it from a state pension, personal pension, or from benefits payments.
Yes, you can get car finance if you’re retired or living off a pension. We accept applications from people aged between 20 and 75, provided they pass our affordability and credit checks.
Car finance lending criteria for pensioners
When it comes to applying for car finance, our lending criteria for pensioners is the same as other applicants. You must:
- Have a monthly income of at least £1,000 (after tax)
- Have a valid UK driving licence
- Be aged between 20 and 75 at the point of application
You must be able to show proof of receiving income from the last 2 consecutive months. This could be from your pension or from other sources. Visit our page to see what types of income we accept or see what documents you might need when applying for car finance with our guide.
Can pensioners get car finance with bad credit?
If you have bad credit, you might think it’s impossible to get a car on finance. This isn’t necessarily the case. We are a specialist lender that help people even if they’ve been refused by other lenders.
We have over 30 years of experience helping people up and down the UK onto a better road ahead. If you’re aged between 20 and 75 years at the point of application, you could join the thousands of people we help every month.
Our online form takes less than 5 minutes to fill in and will give you an instant decision as to whether or not we can help. If you’re approved, our expert team will guide you through the process of financing your new car.
Representative 30.7% APR.
Improving your credit score as a pensioner
You can still take steps to improve your credit rating when you’re retired or in receipt of a pension. Having good credit can make it easier to get credit, including car finance.
To improve your credit score, credit reference agencies recommend:
- Making sure you’re on the electoral register at your current address
- Settling any existing debts and current account overdrafts
- Paying bills on time and in full
- Not making too many applications for credit in a short space of time
You can check your credit report online through the Experian, Equifax, and TransUnion websites.
FAQs about getting car finance as a pensioner
What is retired car finance?
A retired car finance agreement or car loan is a way of borrowing money to help cover the cost of buying a new or used car.
There are different types of car finance available. The most appropriate one for you will depend on a range of factors, including the size of the monthly payments you can afford, the duration of the agreement, and whether you want to own the car outright at the end of the agreement.
For more information, check out our guide that explores the different types of car finance including HP, PCP, CS (which is what we offer), and others.
Should you buy or lease a car in retirement?
The decision of whether to lease a car in retirement or purchase one on finance depends on your personal circumstances and preferences.
Leasing a car is essentially a long-term rental agreement between you and a finance company or dealership, with no option to buy the car outright at the end of the contract term. This may be the better option for you if you want to change vehicles every few years and know that you don’t want to keep the car at the end.
Read our full guide for more information on the differences between buying and leasing a car., or read up on the pros and cons of car finance with our guide ‘is car finance worth it?‘.
Can you get no deposit car finance if you're retired?
If you don’t have the money saved for a deposit, then you might have considered no deposit car finance. This is where you don’t pay anything up front when you sign your car finance agreement. Whether you can get car finance with no deposit depends on a number of personal factors, so no responsible lender can guarantee this without carrying out thorough affordability and credit checks.
We understand that it might be hard to put together a deposit and recognise that living affordably is important. Enter a few details about yourself and your borrowing requirements into our online car finance calculator to see what your agreement might look like.
Can you apply for car finance if you claim a state pension?
Yes, you can apply for a car finance deal if you claim a state pension. The application process is the same as if you were seeking car finance with a personal pension.
What lenders are looking for in car finance applications is evidence of a reliable borrowing history and a regular source of income.
What can make it harder to get car finance as a retired person?
As with any car finance application, certain factors can make it harder to get a finance deal in retirement. These include:
- Any existing debts or loans you have
- Your current credit score and credit record
- Your financial situation and disposable income
- Previous loan defaults or missed payments.
Whether you’re in full-time employment or retired and living off a pension, paying for a new car in one lump sum isn’t always possible.
In this guide, we look at how car finance for pensioners and retirees works in the UK and the factors which could affect your eligibility for credit later in life.
Can you get car finance if you're retired?
It’s a common misconception that you must be in regular employment to purchase things on finance. In reality, you just need to be able to prove that you have a source of regular income, be it from a state pension, personal pension, or from benefits payments.
Yes, you can get car finance if you’re retired or living off a pension. We accept applications from people aged between 20 and 75, provided they pass our affordability and credit checks.
Car finance lending criteria for pensioners
When it comes to applying for car finance, our lending criteria for pensioners is the same as other applicants. You must:
- Have a monthly income of at least £1,000 (after tax)
- Have a valid UK driving licence
- Be aged between 20 and 75 at the point of application
You must be able to show proof of receiving income from the last 2 consecutive months. This could be from your pension or from other sources. Visit our page to see what types of income we accept or see what documents you might need when applying for car finance with our guide.
Can pensioners get car finance with bad credit?
If you have bad credit, you might think it’s impossible to get a car on finance. This isn’t necessarily the case. We are a specialist lender that help people even if they’ve been refused by other lenders.
We have over 30 years of experience helping people up and down the UK onto a better road ahead. If you’re aged between 20 and 75 years at the point of application, you could join the thousands of people we help every month.
Our online form takes less than 5 minutes to fill in and will give you an instant decision as to whether or not we can help. If you’re approved, our expert team will guide you through the process of financing your new car.
Representative 30.7% APR.
Improving your credit score as a pensioner
You can still take steps to improve your credit rating when you’re retired or in receipt of a pension. Having good credit can make it easier to get credit, including car finance.
To improve your credit score, credit reference agencies recommend:
- Making sure you’re on the electoral register at your current address
- Settling any existing debts and current account overdrafts
- Paying bills on time and in full
- Not making too many applications for credit in a short space of time
You can check your credit report online through the Experian, Equifax, and TransUnion websites.
FAQs about getting car finance as a pensioner
What is retired car finance?
A retired car finance agreement or car loan is a way of borrowing money to help cover the cost of buying a new or used car.
There are different types of car finance available. The most appropriate one for you will depend on a range of factors, including the size of the monthly payments you can afford, the duration of the agreement, and whether you want to own the car outright at the end of the agreement.
For more information, check out our guide that explores the different types of car finance including HP, PCP, CS (which is what we offer), and others.
Should you buy or lease a car in retirement?
The decision of whether to lease a car in retirement or purchase one on finance depends on your personal circumstances and preferences.
Leasing a car is essentially a long-term rental agreement between you and a finance company or dealership, with no option to buy the car outright at the end of the contract term. This may be the better option for you if you want to change vehicles every few years and know that you don’t want to keep the car at the end.
Read our full guide for more information on the differences between buying and leasing a car., or read up on the pros and cons of car finance with our guide ‘is car finance worth it?‘.
Can you get no deposit car finance if you're retired?
If you don’t have the money saved for a deposit, then you might have considered no deposit car finance. This is where you don’t pay anything up front when you sign your car finance agreement. Whether you can get car finance with no deposit depends on a number of personal factors, so no responsible lender can guarantee this without carrying out thorough affordability and credit checks.
We understand that it might be hard to put together a deposit and recognise that living affordably is important. Enter a few details about yourself and your borrowing requirements into our online car finance calculator to see what your agreement might look like.
Can you apply for car finance if you claim a state pension?
Yes, you can apply for a car finance deal if you claim a state pension. The application process is the same as if you were seeking car finance with a personal pension.
What lenders are looking for in car finance applications is evidence of a reliable borrowing history and a regular source of income.
What can make it harder to get car finance as a retired person?
As with any car finance application, certain factors can make it harder to get a finance deal in retirement. These include:
- Any existing debts or loans you have
- Your current credit score and credit record
- Your financial situation and disposable income
- Previous loan defaults or missed payments.
For a better road ahead
Moneybarn is a member of the Finance and Leasing Association, the official trade organisation of the motor finance industry. The FLA promotes best practice in the motor finance industry for lending and leasing to consumers and businesses.
Moneybarn is the trading style of Moneybarn No. 1 Limited, a company registered in England and Wales with company number 04496573, and Moneybarn Limited, a company registered in England and Wales with company number 02766324. The registered address for these companies is: Athena House, Bedford Road, Petersfield, Hampshire, GU32 3LJ.
Moneybarn’s VAT registration number is 180 5559 52.
Moneybarn Limited is authorised and regulated by the Financial Conduct Authority (Financial Services reference No. 702781)
Moneybarn No. 1 Limited is authorised and regulated by the Financial Conduct Authority (Financial Services reference No. 702780)
