In today’s gig economy, not having a formal job is a far cry from having no income. There are many reasons for not being in full-time employment: studies, disabilities, family commitments, and freelancing, to name just a few.
Everyone needs transportation, and driving one’s own automobile is often the fastest and most convenient way of getting from A to B in Canada, particularly for people with tight schedules. However, the absence of a regular income can make it harder to obtain a car loan – for exactly the people who most need their own rides.
How to Buy A Car Without A Steady Job
However, it’s often people working irregular hours who need their own wheels the most, particularly when public transportation isn’t running. In fact, a reliable car is a major factor in personal safety, particularly at out-of-the-way locations that may be deserted during off-peak hours.
So here are some hot hints from the experts on fast-tracking car loan approval without a steady job:
- Keep expectations realistic – without a regular job, this isn’t the right time to chase your driving dreams. Instead, go for a low-maintenance model that keeps its resale value, while you focus on turbo-charging other aspects of your life, like your education, career, and savings account. Leave that sporty muscle model on the back burner for a few more years!
- Offer a hefty down payment – save up as much as possible during the months prior to your purchase, even if it means waiting a little longer before buying a vehicle. Having a large down payment shows a potential lender that you can control your personal finances, offering reassurance that the loan will be paid off promptly. As an added bonus, a larger down payment offers the downstream benefit of lower monthly instalments for the term of the loan.
- Provide proof of income – any kind of documentation is useful for proving income, even from part-time or casual work. Alternative sources can consist of court-awarded spousal support, payments from a structured settlement, disability allowances, interest on investments, or even a trust fund. The important thing is to present convincing evidence, showing the lender that you will be able to support yourself while paying off the loan.
- Get a co-signer – this request carries heavy responsibilities, as anyone co-signing for a loan will be on the hook for the full amount if you fail to meet your commitments promptly. This option is often used by students, whose parents (or other relatives) are willing to take this risk. Not so common among friends, and even rarer in the workplace, defaulting on a car loan can ruin a relationship and wreck the borrower’s reputation.
- Get pre-approval – applying for a preapproved loan saves time and hassle, by setting a price range for your new-to-you ride. It also ensures that your documentation (which may include recent bank statements and proof of residence for the past couple of years) is acceptable to a Canadian lender, allowing you to browse a huge second-hand selection of good-quality vehicles costing a fraction of the sticker prices of their newly-launched counterparts.
Smart Choices For Tight Budgets
When incomes depend on gigs or commissions that vary from month to month, a used car can be the smartest way of getting around. At less than half the cost of brand-new models, they are far more budget-friendly; moreover, they can be equally reliable, especially under extended warranties that cover (or at least reduce) unexpected repair costs.
Remember: when you don’t have a regular job, but you really need to get around independently, your best bet is to contact an understanding dealership that will take the time to understand your situation and analyse your repayment capabilities. With a little effort and patience, you’ll be able to buy a car you love at a price you can afford, while building up your credit score for future purchases. And that sounds like a great deal, from any angle!
