Meeting income and employment requirements is an important part of qualifying for a car loan with bad credit. The specifics differ from lender to lender, so it’s essential that you know what each type of lender generally looks for.
Income and Employment Requirements by Lender
When you need a bad credit auto loan, it’s important that you go to a dealership that can help. Typically, this means going to a special finance dealer and working with a subprime lender, or going to a buy here pay here (BHPH) dealership.
Both of these are valid options for getting a bad credit car loan, but they have very different requirements when it comes to income and employment.
Subprime Lenders
Subprime lenders know that a credit score doesn’t always tell the whole story, so they rely on additional factors to approve you for an auto loan. Income and employment are two of them. Even though they’re considered separately, these elements go hand in hand when qualifying for a car loan.
With income, most subprime lenders require you to make a minimum of $1,500 to $2,000 a month before taxes. In order to qualify for a bad credit auto loan, the income to meet this minimum requirement must come from a single job.
The details vary by lender, but if you meet the income amount only because you have two jobs, then you're generally not going to qualify for a car loan with a subprime lender.
If you have two jobs and meet the minimum income requirement with one of them, the additional income from your second job could help you to qualify for a higher monthly payment or longer loan term.
Other income and employment requirements subprime lenders have include:
- You must be able to prove your income with a computer-generated pay stub showing year-to-date income.
- You must have been employed for at least the last six months to one year.
- You must have at least a three-year employment history with no gaps longer than 30 days between jobs.
Buy Here Pay Here Dealerships
Buy here pay here is another name for an in-house financing dealer. These places sell you a vehicle and finance the deal themselves. These dealerships make a good one-stop shop for people that aren’t able to meet the requirements of subprime lenders.
BHPH lots typically carry much less strict income and employment requirements. In order to qualify, you generally have to meet their minimum income requirement and have enough available income after monthly bills to afford the monthly payments of the car you're financing.
In-house financing dealers tend to be independently owned, so the specifics can vary widely. Make sure to ask about their minimum income requirement ahead of time.
At a buy here pay here dealership, it also doesn’t matter how many jobs or sources of income you have just as long as you can make the payments. You usually still need to provide proof of income.
Find the Dealer That Can Work for You
No matter what your financing needs are, it’s a good idea to go through a special finance dealer if your credit is bad. Because they base auto loan approvals on factors in addition to your credit score, there’s a better chance they can work with you.
Auto Credit Express is here to help you get matched to a special finance dealership near you. Fill out our fast and free auto loan request form to get the process started right now!
