Car Financing Advice for the Self-Employed
Being self-employed is an incredible experience that can present a unique set of challenges. For example, you may wonder how you can get approved to finance a car when you aren’t sure exactly how much you will make every month. Whether you own a start-up, run a small business, or are a freelancer, there are ways you can own a car without having to stress about monthly payments. At Taz Loans, we want all our customers to leave satisfied and happy. That is why we have compiled some expert advice about how to get approved for an auto loan when you are self-employed. Keep reading to learn more!
Build your Credit Score
A good credit score (above 600) will help you secure an auto loan with better interest rates. Even if your credit score isn’t the best, if you make your payments on time, your credit will improve, and you can apply for refinancing with better rates down the line.
Keep Your Credit History Intact
Lenders will look at how you have handled loans in the past and will use that to determine a rate that benefits both parties. If you have a good repayment history, your rates should be more affordable.
Show Your Employment Stability
The longer you have been self-employed, the easier it is to get approved. If you just started working for yourself, you may find that you can only secure high-interest loans. But don’t worry; you can always refinance for better rates later.
Verify Your Earnings
You must demonstrate your ability to make consistent monthly payments to get approved, let alone for a low rate. Keeping tax returns and bank statements are good practices for proving you make enough to afford the monthly loan payment.
Down Payment Amount
Putting a large amount as a down payment means less risk for the lender and a better chance you have at getting approved at an affordable rate. If you are having trouble getting approved, try to wait until you have enough to put in a larger down payment.