Can I Get Car Finance If I'm Self Employed?

Added: 14 March 2017

We get asked every week by people like yourself, "I'm self employed, can I get car finance to buy my dream car?". The answer is yes, but like any credit agreement, you need to be able to prove that you can make the monthly payments as stated on your agreement for the duration of the contract.

Should I apply as an individual or on behalf of a business?

Let's make it simple, if you apply on behalf of a business, the business in question will need to have been trading for at least 2 years and the net profit must be at least double the amount that you're looking to borrow for your new or used car.

If you have decided to apply as an individual rather than on behalf of a business, you need to be able to prove your income. Our car finance lenders require you to be able to show regular income via bank statements or other documents. Some websites on the internet state, 'If you have a good credit rating you don't have to prove your income.' Due to changes in the way finance lenders assess finance applications even if you have a very good credit rating, proving your income plays a big part in getting accepted for car finance.

Does my profession matter when getting car finance?

Yes, a good example are self employed taxi drivers, as in most cases they are using their vehicle for commercial purposes. You would expect a taxi driver to travel a lot of miles, the vehicle would have more wear and tear due to the profession, this would have a knock on effect on the value of the car at the end of the agreement when it goes back to the finance lender if they decide to hand the car back.

The following points are what our lenders like to see.

  • 3 months' worth of bank statements.
  • 3 year's worth of address history.
  • You must have been a UK resident for 3 years or more.
  • Tax returns are not accepted as proof of income.
  • Cash in hand is not a provable income.
  • Cash must go into a UK bank account.
  • We can accept proof of income into a UK bank account in the name of your spouse or partner, they will need to be added on to the finance application.
  • Make sure your credit file is accurate and up to date.
  • Make sure you are on the Electoral Roll.
I can't prove my income, what can I do?

If you are self employed and can't provide proof of income another option is to use a Guarantor or a joint application on your car finance application, this lowers the risk you pose to our finance lenders and could help in the acceptance of your car finance application. Increasing the deposit you are willing to put down upfront will help as you are sharing the risk with our finance lenders.

What now?

Being self employed shouldn't stop you buying your dream car, we have helped hundreds of people over the years get car finance. Speak to us if you need more advice about applying for car finance when you're self employed or on behalf of a business, we're here to help.

Sign up to our White Dove Newsletter