Do You Need a Proof of Income for a Bad Credit Car Loan?

Get Car Financing
Even with poor credit.

By

Meghan Carbary has been writing professionally for nearly 20 years. A published journalist in three states, Meghan honed her skills as a feature writer and sports editor. She has now expanded her skill-set into the automotive industry as a content writer for Auto Credit Express, where she contributes to several automotive and auto finance blogs.


, - January 20, 2020

Bad credit auto financing always requires you to provide proof that you have the ability to repay the loan. However, proof of income is just one of the things you need to show lenders when they're considering you for a car loan.

Proof of Income Is Essential for Borrowers

When you get an auto loan, especially as a bad credit borrower, it's important that you're able to successfully complete it. And by working with a subprime lender through a special finance dealership, you're given the chance to prove that you're more than just a low credit score.

Lenders need to be sure you’re given the best chance of success before offering you a car loan, so they have a number of qualifications borrowers must meet before they're approved. Proof of income and proof of employment are essential to this process.

Here's what you need to provide as proof of income for a bad credit auto loan:

  • Your most recent check stub. Lenders sometimes request that you provide more, such as multiple weeks of pay stubs.
  • Check stubs must be computer-generated.
  • Pay stubs must show year-to-date income.
  • Check stubs typically must prove that you make at least $1,500 to $2,000 a month, before taxes.
  • Income must be earned income.
  • Qualifying income must be from a single source of employment. Lenders may consider additional sources when determining if you have enough available income to afford the monthly payments, but not to meet the minimum requirement.

In addition to proof of income, you must be employed as a bad credit borrower. Minimum employment qualifications of at least six months to one year at your current employer, with a three-year work history containing no gaps longer than 30 days between jobs, is required.

W-2 income is preferred, but self-employed or contract individuals may be able to qualify, usually by providing two or three years of tax returns.

Additional Requirements for Bad Credit Car Loans

Even though income and employment are two main components of being eligible for a bad credit car loan, there are a few other requirements. Lenders want a full picture of your creditworthiness regarding your ability, stability, and willingness to successfully complete a loan.

We've already talked about the ability to pay a bad credit auto loan, which comes from your income. Lenders are also looking for employment and residential stability.

In addition to the employment requirements mentioned, most lenders require proof of residence with a current utility bill in your name, at the address listed on your application. Other requirements typically include proof of a working landline or contract cell phone in your name, and a list of five to eight complete personal references.

Lastly, you have to prove you're willing to invest in your own success by providing a down payment. The details vary by lender and your situation, but you're typically required to put down at least $1,000 or 10% of the vehicle's selling price, whichever is less.

Finding an Auto Loan

There's no getting around proof of income when you need a bad credit car loan through a subprime lender. These lenders follow these requirements and also look at other factors in addition to your credit score and reports. Sticking to these requirements gives you a better chance for an auto loan approval as a bad credit borrower.

If you're ready to look for your next car loan, we want to help. Here at CarsDirect, we work with a nationwide network of special finance dealers that have lenders available to help people that are struggling with poor credit.

Driving all around town trying to find the right lender on your own can be stressful and time consuming. Skip those hassles by filling out our quick, easy, no-obligation auto loan request form. Then sit back, and let us match you with a local special finance dealership. Get the process started right now!

Free Credit Score

Get your free credit score now! Get a copy of your most recent credit score.

Get Your Free Score

Auto Insurance

Get competitive quotes on insurance in your area.

Sell Your Car

We will buy any car, running or not, with or (in most cases) without the title.

Get My Price

Need a Car Loan?

It only takes a minute.

Meghan Carbary has been writing professionally for nearly 20 years. A published journalist in three states, Meghan honed her skills as a feature writer and sports editor. She has now expanded her skill-set into the automotive industry as a content writer for Auto Credit Express, where she contributes to several automotive and auto finance blogs.


Search New Cars by Loan Payment »

View estimated loan payments based on local rebates and financing offers.

Loan approval is not guaranteed and is subject to credit application and approval of the lender. Individual loan terms may vary. Use of this website constitutes acceptance of CarsDirect.com's Terms of Use, Disclaimer, Privacy Policy, and Cookie Policy.

Privacy Policy|Do Not Sell My Personal Information|Terms of Use|Cookie Policy|Disclaimer
COPYRIGHT 1999-2020 MH Sub I, LLC dba CarsDirect.com