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Self-employed car finance

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Zuto is a credit broker, not a lender. Our rates start from 10.6% APR. The rate you are offered will depend on your individual circumstances. Representative Example: Borrowing £8,000 over 60 months with a representative APR of 20.9% the amount payable would be £208 a month, with a total cost of credit of £4,486 and a total amount payable of £12,486.

Self-employed car finance

Running your own business can be very rewarding, giving you the freedom to work your own hours and expand your career on your terms. Being self-employed you can sometimes encounter financial challenges, but if you’re a freelancer or self-employed, car finance can be simple.

Can I get car finance when I’m self-employed?

The best way to finance a car for self-employed drivers is to take a look at the different options Zuto can offer. We work with a trusted panel of lenders who understand and offer specific products, which meet the unique considerations of self-employed work or running your own business.

Finding the right self-employed finance might even be an essential part of growing your business, so we’re here to help you get it right. We’ll do our best to find you a self-employed car finance deal that suits your working situation and personal circumstances.

Types of car finance if you’re self-employed

There’s the same variety of car finance options for self-employed people as anyone else. The three main types are:

  • Hire Purchase (HP) – the most popular type of used car finance, you pay off the value of the car in monthly payments, plus interest over a set period. You can pay to own the car outright at the end of the contract.
  • Personal Contract Purchase (PCP) – more popular with new cars, with PCP your monthly payments cover the car’s depreciation. You can make a balloon payment to own the car outright at the end of the contract.
  • Personal loan – you can take out a loan to cover the cost of the vehicle, which is yours from the start.

Find out more about car finance options.

Car finance calculator

See how much you could borrow

What documents will I need to apply for self-employed car finance?

Your car finance quotes, and eventual agreement, will be based on numerous factors. Today, lenders understand there are many different ways of proving your earnings.

  • Deposit – the more you’re able to pay as a deposit, the less your monthly payments will be. It could also lead to a better interest rate, known as APR. If you don’t have the capital available, you can still apply for car finance without a deposit.
  • Credit score – you can apply for car finance with bad credit. A better credit rating can help you get a better car finance deal, so it’s worth taking some simple steps to improve your credit score to make sure it’s as strong as possible before agreeing to a quote.
  • Proof of income – lenders will need to see evidence of an income. The longer and more consistent your income history, the better. If you’re in between jobs, we can also help with unemployed car finance.

Proving your income can be challenging for self-employed people, so we have more details below.

How to prove your income if you’re self-employed

Most lenders want to see proof of earnings. This also applies if you’re employed, self-employed, unemployed or receiving benefits.

There are several different kinds of self-employed status, and the best way to prove your earnings may differ depending on which category you fall into. We may require:

  • 3-6 months of bank statements
  • Details of your company accounts
  • 5-year employment history document from HMRC
  • 5 years’ worth of tax returns

We have over 15 years of experience in helping people who are self-employed get car finance. Once we know more about your situation and the kind of deal you’re looking for, we’ll be able to advise you about the proof of earnings you’ll need to provide.

Will applying for finance affect my credit score?

Applying for car finance won’t affect your credit score. A ‘hard’ credit search will only be carried out with your consent, and only if you’re approved and have decided to proceed with your car finance offer.

Being self-employed with bad credit

Bad credit shouldn’t stop you from considering self-employed car finance.

We work with a panel of lenders who are used to helping drivers with poor or bad credit ratings, whether that’s because of a short credit history – such as for young drivers – or measures including county court judgements (CCJs).

If you have a bad credit score, there are some things to think about:

  • Try to improve your credit rating – whatever kind of credit score you have, there might be some easy things you can do to improve it, such as making sure you’re on the electoral register.
  • Find a guarantor – guarantors are usually family members, like parents, who know you well and will vouch for you. They’ll make the repayments if you can’t. Even with bad credit, many people can still get car finance without a guarantor.

Whatever your situation, the Zuto team have lots of experience in finding car finance for self-employed people, or those with bad credit. Just get in touch and we’ll see how we can help.

Can I get car finance with no proof of income?

We understand there are various reasons why some customers are unable to show proof of income when applying for self-employed finance.

Whether you’re currently unemployed, self-employed, or retired, we work with a large panel of lenders, some of which accept applications with no proof of income, to try and find you the best car finance deals based on your personal circumstances.

When you make an application for self-employed car finance, the decision you receive is based on your circumstances, and the lender will take into consideration numerous factors such as the likelihood of you repaying the loan amount in the period you’ve applied for.

This is why some lenders require evidence of income to prove you can repay the loan. Helpfully, some lenders can do this electronically without you needing to send in any documents.

If you’re worried about being accepted for a loan or aren’t sure if you have the proof required, you can apply for finance without impacting your credit score. Alternatively, discover even more help and advice from our experts.  

Increase your chances of being approved for car finance if you’re self-employed

There are various things you can do to improve your chances of getting approval for car finance if you’re self-employed. Firstly, keeping comprehensive, up-to-date records of your income will help, as will keeping bank statements and tax returns, both of which may be requested during a finance application. 

Improving your credit score will also help, as it can have a major impact on a car finance application. You can do this in various ways, such as paying down old debts and registering for the electoral roll. 

Saving a larger deposit can also improve your standing with potential lenders, who will be taking less of a lending risk the more you can put down. Finally, double-check what monthly payments you can afford. Our affordability calculator can help you work out what payments you can realistically make and will help you budget so that you’re not overstretching yourself.

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