What Proof of Income do I need for Car Finance?
Proof of Income requirements for Car Finance
Lenders are becoming more effective at confirming a borrower’s income.
They’ll need to know your income and employment status:
- Pension payments
- On benefits (Universal Credit or Tax Credits)
By giving the lender knowledge of your monthly income and any additional payments, an affordability check protects you by ensuring you can afford to borrow the amount you request and that you won’t overstretch your finances, getting into financial difficulty.
The usual request is proof of income copies of your payslips or bank statements for two or three months. You’ll need to upload copies of any documents. Your statements must show your name, account number, sort code, and all transactions.
Alternatively, you may get an invite to use Open Banking, which can be most helpful if you are self-employed or have a bad credit score. Open banking is a secure way that lets the lender verify your income and expenditure and see how you manage your money, helping them decide whether to give you a loan. Previously only your bank had access, but now, you can choose who can see with open banking. All you need do is go online and open your bank portal, select the account your income goes into and then give permission to share your bank details with the lender. They can then efficiently calculate your affordability.
How many Payslips do I need for Car Finance?
Lenders must check your income to ensure you can afford the monthly repayments before they give it to you. Payslips are proof of income. You’ll need to provide three monthly payslips as a part of your car finance application.
Can I get Car Finance without proof of Income?
There are many reasons someone might not be able to demonstrate proof of their income when applying for a car loan.
You may be unemployed, self-employed, on a pension or benefits and have difficulty providing proof of income. However, we have a large panel of lenders available, some of which accept car finance applications with no proof of income through open banking.
Working with car finance providers specialising in bad credit car finance and open electronic checking (open banking) allows customers without proof of income to find the best deal available.