Securing car finance if you’re self-employed can seem more complicated than for people in traditional employment. The good news is that if you understand the process and know how to prepare yourself for it, securing car finance can become much simpler. 

The main difference between being traditionally employed and self-employed is the proof of ability to pay. Self-employed professionals experiencing fluctuating incomes and unique business models can make lenders a bit more hesitant to offer them finance. 

What Documents Will You Need?

If you're self-employed, you may be asked to provide proof of income, because your earnings may be different from one month to another. However, it’s not always necessary.

This can include, but is not limited to:

• Tax returns - SA302
• Bank statements, or completion of an open banking link
• CIS payslips

How Does Your Credit Score Affect Your Car Finance Options?

A strong credit score is crucial in securing car finance. If your credit history is less than ideal, it can make finding car finance a bit more complicated. For more information about what credit scores are, check out our article for a simple overview.

If you are looking for simple ways to boost your credit score, we also have something for that! We have collected nine nifty tips to boost your credit score that aren’t overly complicated. 

Are There Ways to Boost Your Chances of Approval?

Car finance cannot be guaranteed for anyone, regardless of if they are traditionally employed or self employed. There are some factors that could have a positive impact on getting a referral: 

• A larger deposit can increase your likelihood of approval. It reduces the total amount that you need to borrow, which makes you a less risky prospect for lenders.
• Ensure your finance application is error-free. Mistakes can raise red flags for lenders.
• Providing clear proof of income can reassure lenders of your ability to successfully manage repayments.

What Car Finance Options Do Self-Employed People Have?

As a self-employed professional, with Ozoomi you have access to the same car finance options as people with regular employment terms. These are Hire Purchase (HP), Personal Contract Purchase (PCP) and Conditional Sale (CS). 

HP (Hire Purchase)

This is where you pay a deposit (which can be zero) followed by monthly payments. Once all payments are made, you have the option to pay a very small fee to become the legal owner of the car.

PCP (Personal Contract Purchase)

PCP is a more flexible finance option if you prefer to change your vehicles more often. Initially, you pay a deposit and then lower monthly payments compared to HP. At the end of the term, you have three choices: pay a final balloon payment to own the car, return the car, or trade it in and start a new contract.

CS (Conditional Sale)

Similar to HP, Conditional Sale involves paying a deposit (which in some cases is optional) followed by fixed monthly payments. The difference lies in the ownership terms. With CS, you automatically become the legal owner of the car after the final payment without any balloon payment.

Please be aware that this is the most simplified overview of the finance offers offered at Ozoomi. For more in depth information, including specific considerations and limitations of each of the options, please take a look at our Car Financing Explained section. 

Are you a self-employed professional looking to finance a car? Ozoomi can help! We are proud to be confident in giving people, regardless of their financial circumstances, the best chance at securing the finance that best fits them. You can try our quote generator, or feel free to get in touch with us - one of the team will get back to you!