Can You Get a Car Loan Without Proof of Income?

When applying for a car loan, you’ll need some important documentation to get approved. Those documents include a driver’s license, proof of insurance, proof of residence (sometimes), and proof of income. But can you obtain a car loan without proof of income?

A large down payment may be necessary without proof of income

A customer sits in front of a salesperson at a dealership.
A customer applies for a loan at a car dealership. | J. Conrad Williams Jr./Newsday RM via Getty Images

If you currently work a job that pays you in cash or you can’t otherwise verify your income, expect to have a large down payment ready. A down payment equivalent to 20% of the car’s cost is typically recommended. However, depending on the lender’s requirements and credit score, you may need 30 to 40% without proof of income.

The larger down payment is because you’ll be less likely to be “upside down,” or owe more on the loan than the car’s worth. According to Cars Direct, “the lender requires more of a down payment from those who cannot provide income because if the payments are not received, it can repossess the vehicle and resell it without taking a huge loss.”

You may need to get creative without proof of income

A Dodge Viper sits in a dealer showroom.
A dealership showroom seen through a window. | Tim Boyle/Getty Images

Obtaining an auto loan without proof of income is possible, but you may need to get creative with it. Since you may not have W2s or 1099 forms to show the lender, you can try presenting a bank statement to show your deposits in a bank account. Doing so will show the lender that you have enough money to afford the loan and the required monthly payments.

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Another solution is to get a co-signer to go in with you on the loan. A trusted third party with a great credit score and proof of income could increase your chances of obtaining an auto loan. Also, a great credit score could help the situation if no proof of income is available.

Other loan options that don’t require proof of income

A couple checks out a Porsche on the showroom floor
A couple checks out a Porsche on the showroom floor. | Kaveh Kazemi/Getty Image

If you can’t get a co-signer and the lender won’t accept your bank statements, other loans are available. Check out the following options:

  • Buy here, pay here: While we don’t recommend getting a car from a “buy here, pay here” dealership, it is an option. These are local dealers that forgo traditional income verifications if you meet the credit requirements. In this scenario, you would make the monthly payments to the dealership itself. However, these types of loans come with high-interest rates and fees.
  • Borrow from a friend or family member: Borrowing money from a trusted friend or family member is a workaround to getting an auto loan. One caveat is that it could ruin your relationship with them if you don’t repay the loan, so it’s recommended that you lay down some terms beforehand.
  • Home equity loan: A home equity loan is when you borrow money against your home’s equity. The equity is the difference between the amount you owe on the loan versus how much the car is worth. For example, if your home is worth $200,000, but you owe $120,000 on it, you can borrow a portion of the $80,000 difference.

Although these alternative loan options may not be ideal compared to a traditional auto loan, they present a viable way to get money for a car. Getting an auto loan without proof of income can be tricky, but it’s possible. You’ll have to either find the right lender or choose a different route.

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