finding a vehicle for a growing family

Getting a car loan is very easy to do if you have excellent credit and a good job. Unfortunately, there are many people that do not match this criteria. If you are self-employed and have credit that is less than stellar, you may have a little more trouble trying to qualify for a car loan. If you really need to buy a car and are self-employed, you might still be able to qualify for a loan, even if your credit is not great. Here are a few tips you can follow that may help you get approved to buy a car.

Gather Your Tax Returns

One important aspect of qualifying for a car loan is proving your income. Unfortunately, if you are self-employed, you may not have W-2s or paystubs to show for this purpose. There is another way to prove your income, though, and it involves submitting your tax returns to the dealer.

Dealers will often want to see the last two tax returns you have. They do this to make sure you have steady income over a period of time, and your tax returns are the best way to prove this. If your tax returns do not show a lot of income, you may encounter problems, but you could always show the dealer your bank statements too.

One perk of owning your own business is the ability to write off your expenses. While this can reduce your tax liability, it will also reduce the income you make. If you actually make more income than the amount reflected in your tax returns, your bank statements will help you prove this. Verifying your income is a standard procedure used by auto financing companies, and it is done simply to make sure you have the ability to repay the loan.

Visit A Dealer That Specializes In Bad Credit Loans

Having bad credit will not automatically disqualify you from getting a car loan. In fact, a lot of dealers are willing to give loans to people with bad credit; however, they may compensate for their risk by charging a higher interest rate. In addition, there are dealers around that specialize in bad credit loans.

If you have really bad credit and are having a hard time proving your income, this might be the best route to take. When you visit a dealership like this, you can almost be certain you will get approved for a loan. The terms of the loan might not exactly be great, but at least you could get a car.

Consider Using A Cosigner Or Joint Applicant

If you apply for a car loan in your name alone, your terms and approval odds will be based strictly on your credit and income alone. On the other hand, if you apply for a joint loan or with a cosigner, your loan will be based on the credit of the other person that signs the papers. This could be your spouse, child, relative, or friend, and it would have to be someone with great credit.

By choosing this option, you may have a better chance of getting approved for the loan, and your loan terms are more likely to be better. The downside to this is that you will have to find someone willing to sign your loan documents. If you fail to pay this loan, the person that signed the papers will become responsible for the debt.

With the right steps, you should be able to get a car loan if you are self-employed and have bad credit. If you would like to learn more or apply for auto financing, contact an auto dealership in your area today. Click here for info about auto financing.