Ford Fiesta and Focus could cost almost £10,000 more for thousands of road users
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Prices for a brand new Ford Focus bought with a bad credit rating would cost £36,221 compared to just £26,778 for those with hood ratings, according to new data. This would see drivers paying an extra £9,443 for a brand new model if they fail to get their finances in shape.
Prospective Ford Fiesta owners are also set to be affected with drivers facing an extra £7,000 bill by purchasing a car with a bad credit score in place.
James Andrews, personal finance expert at USwitch has urged drivers to check their credit score and “take steps” to make changes.
He said: “Registering to vote, having bills in your name, keeping to 30 percent or less of your total available credit (per account) and not having a credit history can all impact your credit score.
“When financing a car, first check your credit report to see what your score is. Secondly, check what’s in there and that the information is accurate.
“Lastly, start taking steps to improve your score.”
USwitch says Ford’s Fiesta and Focus models are two of the most popular models purchased by road users.
Purchasing cars on finance have soared in popularity in recent years as consumers get more used to monthly payments instead of upfront charges.
Data from the Financial and Leasing Association shows 91 percent of new cars were purchased on finance in the 12 months to 2019.
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Data shows there was a slight drop in demand when the pandemic hit in 2020 but this has surged up since.
The consumer car finance market reported growth of 1286 percent in April 2021 compared to the same time 12 months previous.
The graph suggests just over 50,000 models have been purchased by consumers on finance in April alone.
The used car finance market was also up by 1061 percent in April compared to the same month in 2020.
Experts suggest the car finance market is set for a bigger growth in 2021 and 2022 as drivers look to secure new models.
Geraldine Kilkelly, Director of Research and Chief Economist at the FLA said they would expect almost 20 percent growth this year and even more next.
She said: “The consumer car finance market received a boost in April as showrooms re-opened, with the significant growth rate also reflecting the all-time low level of new business recorded in April 2020 at the start of the first lockdown.
“Pent-up demand and an improvement in consumer confidence are expected to contribute to a strong recovery during the second half of 2021, with our latest research suggesting that consumer car finance new business by value will grow by 19 percent in 2021 as a whole, and by a further 13 percent in 2022.”
Mr Andrews said drivers can improve their credit rates and see prices fall “in as little as four months” if action is taken.
He said: “Providing you make your payments on time, don’t apply for many new products in a short period (e.g six months), and keep a stable address, your credit rating should improve.
“In as little as four months you should see your scores start to improve and after a year you should be in a far stronger position.”
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