TL;DR
Asset finance is available to UK businesses with bad credit or limited trading history. Because the asset acts as security, lenders focus on asset value and cash flow rather than credit score alone. Specialist lenders including Time Finance, Nucleus and Fleximize consider CCJs and adverse credit. The FLA reports a 96 percent approval rate for asset finance versus 45 percent for bank loans.
Last reviewed: June 2026 | Sources: FCA Register, FLA, HMRC, legislation.gov.uk
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Key Facts Approval rate: 96% (FLA 2024)Bank loan approval: 45%Min trading history: 6 months (some lenders)Security: The asset itself |
Can I get asset finance with bad credit?
Yes. Asset finance is one of the most accessible forms of business funding for companies with poor credit history, county court judgments (CCJs) or limited trading record. The asset being financed acts as security for the lender. If the business defaults, the lender can repossess and sell the asset to recover their money. This reduced risk allows specialist lenders to approve applications that mainstream banks would decline.
The Finance and Leasing Association reports that asset finance has a 96 percent approval rate across the market, compared to 45 percent for bank loans and 61 percent for overdrafts.
What lenders consider for bad credit applications
Asset type and value -- lenders are more willing to finance hard assets (plant, machinery, vehicles) that hold value and can be repossessed and resold. Soft assets offer less security and may require a stronger credit profile.
Business cash flow -- lenders assess whether the business generates sufficient revenue to service payments, regardless of past credit events. Bank statements for three to twelve months are typically required.
Age of adverse credit -- a CCJ from five years ago carries far less weight than one from six months ago. Many specialist lenders consider businesses where adverse events are older than two to three years and have been satisfied.
Director credit profile -- for smaller businesses, lenders often assess personal credit alongside business credit. Personal guarantees are common for bad credit applications.
Trading history -- most mainstream lenders require two years. Specialist lenders such as Nucleus accept businesses trading for as little as six months.
Asset Finance Lenders for Bad Credit UK
| Lender | Min Trading | CCJ Policy | Personal Guarantee | FCA FRN |
|---|---|---|---|---|
| Time Finance | 6 months | Considered case by case | Often required | 724367 |
| Nucleus Commercial Finance | 6 months | Considered | Often required | 722830 |
| Fleximize | 12 months | Considered | Often required | 669275 |
| Portman Asset Finance | 12 months | Older CCJs considered | Sometimes | 614061 |
| Close Brothers | 2 years | Case by case | Sometimes | 124750 |
| Shawbrook Bank | 2 years | Stricter criteria | Sometimes | 204596 |
Source: Lender published criteria, FCA Financial Services Register. Verify directly with lenders.
How to improve approval chances
Use a broker -- NACFB-accredited brokers have relationships with lenders who accept adverse credit and can match applications to appropriate lenders without multiple credit footprints.
Provide a larger deposit -- offering 20 to 30 percent of the asset value reduces lender risk and can unlock approval for poorer credit profiles.
Choose a hard asset -- plant, machinery and commercial vehicles that hold value give lenders stronger security.
Explain adverse credit -- a letter explaining past credit problems (redundancy, health, pandemic) helps specialist lenders make a more informed decision.
Offer a personal guarantee -- directors personally guaranteeing the agreement provides additional recourse and can be the difference between approval and decline.
Cost of bad credit asset finance
Businesses with adverse credit pay higher rates. Standard asset finance rates range from 5 to 12 percent APR. For businesses with significant adverse credit, rates of 15 to 25 percent APR are possible with specialist lenders. Arrangement fees of one to two percent are common. Review all terms including early repayment charges before committing.
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Disclaimer This guide is for information only and does not constitute financial advice. Asset finance products vary by lender and business circumstances. Always verify lender details on the FCA Financial Services Register at register.fca.org.uk before applying. Kael Tripton Ltd is an independent editorial publisher and is not regulated by the FCA. |
Frequently asked questions
Can a limited company with CCJs get asset finance?
Yes. Specialist lenders assess CCJs on a case-by-case basis, considering age, value and whether satisfied. CCJs older than three years that have been paid are often disregarded. Recent unsatisfied CCJs are more problematic but not necessarily disqualifying for hard asset finance.
Do I need a personal guarantee for bad credit asset finance?
For businesses with adverse credit or limited trading history, personal guarantees from directors are common. A personal guarantee means the director is personally liable if the business cannot meet payments. Always take independent legal advice before signing a personal guarantee.
How long does bad credit asset finance take?
Specialist lenders typically take three to ten working days for decision and documentation, compared to same-day decisions from mainstream lenders for straightforward applications. Using a specialist broker speeds up the process by submitting to the right lender first time.
Will applying for asset finance affect my credit score?
A credit search will be carried out, leaving a footprint on the business and potentially director credit files. Multiple applications in a short period can negatively impact your score. Using a broker who approaches multiple lenders with a single initial soft search minimises credit footprint damage.
What is the minimum credit score for asset finance?
There is no universal minimum credit score for asset finance. The asset security means lenders can approve applications that would fail a pure credit score assessment. Check your Experian, Equifax or TransUnion business credit score before applying to understand your starting position.
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Sources FLA: Asset Finance Statistics |
