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Stephen’s journey to Applying for a Car Loan after a Part IX Debt Agreement with Finance One

Sep 16, 2021 | Client Success

You may be able to apply for a car loan after a Part IX Debt Agreement, even if other lenders say no. Take a look at how we were able to help one of our clients upgrade his vehicle with a loan from Finance One.

Stephen didn’t realise there were longer-term implications related to a Part IX Debt Agreement until it was too late. Fortunately, Stephen was able to get a loan for the bigger and safer car that he needed with the help of Finance One.

When his personal financial situation became difficult several years ago from a guarantor arrangement gone wrong, Perth-based tyre technician Stephen Gillum opted for a Part IX Debt Agreement. This allowed him to make his outstanding debt repayments over the course of several years.

However, when Stephen signed on for this arrangement, the consequences weren’t made clear to Stephen and he did not fully understand all of his obligations with respect to the Part IX Debt Agreement.

With a Part IX Debt Agreement, it is important to understand that the debt can be listed on your credit report for a minimum five-year period, even after the outstanding repayments are complete.

“Nobody explained the long-term ramifications to me or mentioned how hard it would be to borrow once the Part IX Debt Agreement had finished,” says Stephen.

 

The resulting bad credit history wasn’t such an issue for Stephen until it was time for him to apply for a car loan. With two small children and a car in constant need of repair, Stephen knew it was time to upgrade his vehicle to something larger and more reliable that was more suited to his needs.

In some instances, paying off a loan in accordance with the loan terms and conditions, can be one of the best steps to rectify a bad credit history. It can sometimes help show to lenders that you are a reliable borrower and can make consistent repayments on time. However, anyone with a bad credit history can find themselves in a chicken/egg situation – to improve your credit score, you may need a loan but to get a loan, you may need a good credit score.

“The Part IX Debt Agreement was paid and complete and I had been in my job for nine and a half years with a solid income stream, but I wasn’t sure if I would be able to find a lender,” explains Stephen, who lives in the hills area just outside of Perth.

To try and help solve his bad credit history problem without ending up with a list of rejected applications on his credit file, and potentially an even worse credit score because of a number of rejections, Stephen did some online research to see which lenders might actually be willing to work with him. Stephen also spoke to a broker who recommended he apply for a car loan as a way to help repair his credit history. “That’s when I made contact with Finance One,” Stephen says.

 

Applying for a car loan after a Part IX Debt Agreement

Stephen looked for lenders who were able to look beyond his history of a Part IX Debt Agreement and he also read reviews about different lenders, before speaking directly to Isaac from Finance One.

In their initial discussions, Isaac was able to help calm Stephen’s nerves about applying for a car loan. From there, the process was quite easy. After supplying the necessary information including bank statements, employment history and identification, the approval for Stephen came through in around a day*. Even Stephen’s car dealer made mention of how easy it had been to work with Finance One.

“The repayments are very straightforward and Finance One made sure I could afford them before they finalised the transaction,” says Stephen. “Finance One explained everything in a way that was easy for me to understand.”

Now behind the wheel of a bigger and safer 2015 Isuzu MU-X, complete with roof racks, bull bar and light bar, Stephen and his family are looking forward to taking some longer road trips. “We have family who live around 13 hours away so we will be able to just jump in and drive. If you have a nice car, you can enjoy that type of journey,” Stephen explains.

When it comes to applying for a car loan, or any kind of loan, after a Part IX Debt Agreement, Stephen’s takeaway tip from his experience is to “just keep swimming”.

“It doesn’t hurt to ask and there are always options out there. Do your research, ring around and speak to people to see what might be possible for you…and contact Finance One!” Stephen says.

After experiencing personalised service and speaking directly with our finance consultants, “I would recommend them without a doubt,” says Stephen.

 

Need help to apply for a car loan after a Part IX Debt Agreement? If you have a steady income and proof of identity, you may find the solution you are looking for from Finance One.

*24 hour approvals are subject to satisfactory documentation being received to assess the application. Normal lending criteria apply. Fees and charges are payable. Terms and conditions apply.

Disclaimer: The information above is of a general nature only and does not consider your personal objectives, financial situation or particular needs. You should consider seeking independent legal, financial, taxation or other advice to check how the information relates to your particular circumstances. We do not accept responsibility for any loss arising from the use of, or reliance on, the information.

Normal lending criteria apply for all new loan applications. Fees and charges are payable. Terms and conditions apply.

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WRITTEN BY

WRITTEN BY

Makala Elliott

Makala is the Marketing Manager at Finance One. She has worked in the Finance and Lending industry for over 10 years, gathering a wealth of experience. She is passionate about helping Australians get back on track with their finances by passing on her knowledge.

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