Can Uber Drivers Get Car Loans?
Wanna drive an Uber in your spare time but don't have enough savings to buy a car outright? Not to worry, you can get a car loan to buy a car for Uber.
If you've got a few spare hours during the week, or just want to maximise your regular commute, driving for Uber is a great way to make some extra money, driving as much or as little as you like.
The catch is that you can't drive just any car as an Uber driver - you've got to meet some minimum requirements. This means that if you've got a rather old car, you might not be able to drive it for Uber.
Choosing a car for Uber: Requirements
Most newer cars will qualify to drive with UberX, which is the most popular option for passengers. Your car needs to be in excellent working condition, less than eight years old, with four doors.
You must have working windows and air-conditioning, pass a vehicle inspection, and seat four to seven passengers.
This means that most small to medium cars will be suitable, as long as you've got four doors, you have a lot of options you choose a car for Uber.
Car Loans for Uber drivers
A car loan for Uber drivers will come in handy if you need to buy a car for Uber. Here are some tips to help you get a car loan as an Uber driver:
1. Get a car loan and use Uber to pay it
Uber has more passengers than drivers, so if you are intending to get a car loan anyway, and you want to pay it off using some additional income from driving it, you can drive for Uber when it suits you. Your car loan will be approved based on your regular income, rather than your Uber income.
This means you can put in some time after work, or on the weekend, and if you need a break or time off at any point, it's 100% on your terms.
2. Record your Uber income
Uber will allow you to drive a car that you don't own while you save a deposit, and so that you can show that you have a steady, reliable income you can use to pay off a car loan.
As long as you are listed as an insured driver, you can borrow or hire a car. With a few months of regular income behind you, you'll be able to get a car loan based entirely on your Uber income. Uber pay you weekly, so you will get a good idea of how much you can expect to make quite quickly.
3. Consider a used car for Uber
Your car for Uber doesn't have to be brand new - any car less than eight years old is okay. This means that you can buy a suitable car for Uber for $10,000 or less.
It makes sense to have your car for Uber double as your car for personal use too. That way if you change your mind about driving for Uber, and you've still got the car loan, you won't feel like it's a waste.
4. Get approved as a driver
It is a good idea to get approved as a driver before you consider a car loan for Uber. That way if you don't get approved, you haven't lost anything. The specific criteria vary from state to state.
To be an Uber driver, you need to be 21 yrs old, hold a full Australian driver's licence for at least 12 months, and provided evidence that you are listed as an insured driver under the comprehensive car insurance for the car that you'll drive.
You'll also need to pass the background police check and driving history.
5. Know your loan options
There are a few different types of car loan that you can choose from to buy a car for Uber:
- Secured car loan
- Low doc loan
- Rent to buy
- Personal loan
Secured car loans
The most popular form of car loan, this type of loan offers a lower interest rate using the car as security for the loan. You'll need to show that you have enough surplus income to make the car loan repayments.
Low doc car loans
If Uber is already your main source of income, this could be a good option to buy a car for Uber. You'll need to have tax returns showing your income.
Personal loan
A personal loan gives you access to a lump sum that you can use to buy a car for Uber, as well as any other purpose that you need the money for. Then you can repay the loan using your income from Uber.
Bad credit car loan
If you have bankruptcy or missed credit payments, you can still use a car loan to buy a car for Uber. You'll just need to show that you can afford the repayments. Once approved, make each payment on time using your extra Uber income, and before you know it you'll be able to refinance to a regular car loan.
Why wait for your savings to grow before purchasing a car for money-making ventures? Find out how you can get your Uber driver car loan and start earning. Call us on 1300 722 210 or apply for a Loan Pre-Approval now.
See also:
Car-related Business Ideas to Start Without Money
Tom Caesar is the Managing Director of The Positive Group, a group of Australian financial services companies offering a broad range of finance to clients Australia wide. The Positive Group assist clients in the areas of car finance, mortgages, insurance & wealth management. Tom has been in car & asset finance for over 10 years. Tom regularly contributes articles on car finance, insurance, technology and business growth, drawing on his experience of starting his own brokerage in 2009.