What do you need to finance a car?

While the exact requirements to finance a car will depend on the type of finance you get, you’ll generally need a UK driving license and documents to prove your identity, address and income.

6 min read
couple looking at paperwork

What documents do you need to finance a car? 

Most car finance lenders will require a variety of documents to confirm your personal details. Exactly which documents are required will depend on:

  1. the type of finance you apply for
  2. the lender you choose
  3. your individual circumstances.

However, you can generally expect lenders to ask for your: 

  • UK driving licence
  • personal details (such as your name, address, driving licence details etc.)
  • bank details
  • proof of identity (such as your passport, birth certificate or any name change certificates)
  • proof of income and employment history (such as payslips, P45s or P60s)
  • proof of address over the past three years (such as utility bills)

Read on to find out what checks are done for car finance.

Do you need a driving licence to get car finance? 

Yes, to get car finance, you must prove that you’re legally allowed to drive. This means you’ll need to supply your full UK driving licence with your application.

If you have a provisional driving licence, you may still be able to take out car finance - but not all lenders will allow it. If you’re a young driver with a provisional licence and a thin credit history, lenders won’t be able to tell if you’re a safe driver or a responsible borrower. So, they may think it’s too risky to lend to you. If they do accept your application, you might not be able to borrow as much as you’d hoped.

Remember, if you have a provisional licence, you must be accompanied by a qualified driver when you get behind the wheel. They must be at least 21 years old, with a full driving licence from Northern Ireland, Great Britain or an EU country from at least three years previous.

What documents do I need to provide if I’m self-employed? 

If you’re self-employed, the documents you’ll be required to provide will be slightly different, compared to employees of a company. Instead of providing proof of income in the form of payslips, P45s or P60s, you’ll need to provide your accounts and/or bank statements (if they show proof of regular income). You may also be asked for your tax return records.

Can I provide photocopied documents? 

No, unfortunately, lenders don’t normally accept photocopied documents for car finance applications.

They will need to see the real thing when it comes to proof of ID (like your passport or driving licence), income and address. Don’t worry though, the lender will return these to you.

What are the requirements to finance a car?  

Now we know what documents you need, we can dig into the eligibility requirements a little further. Once the lender has received the requested paperwork, they’ll check that the information you’ve provided matches their criteria.

The eligibility criteria will differ between providers and finance types, but there are some general requirements that all lenders have in common: 

  • you must be 18 years old or over – this is because in the UK you must be 18 to qualify for credit, even though you can get a driving licence from the age of 17
  • you must live in the UK – a standard requirement for UK credit agreements
  • you need a source of income – lenders will check your affordability to make sure you can meet the car finance repayments, based on your income and outgoings
  • you must pass the lender’s credit check – the higher your credit score the better your chances of approval

What credit score do you need to finance a car? 

When you apply for car finance, the provider will check your credit score, as it gives them a good indication of how well you’ve managed your finances in the past. There’s no hard and fast rule about what credit score you need to get approved, but the higher it is the better.

Having a good credit score will not only improve your chances of getting approved, but it should also enable you to get more competitive rates and deals.

However, there are many different types of car finance out there to suit all different circumstances. So, if your credit score is less-than-perfect, that doesn’t automatically mean that you won’t be able to get car finance. But if you are accepted, it can affect the rates you’re offered and what options are available to you.

So, it’s a good idea to get your credit score to the best possible place if you’re looking for a good deal.

Have a look at these tips to boost your credit score.

What is the minimum income to finance a car?  

For most car finance deals, you need to have a regular income coming in, so that you can afford the monthly repayments. However, there isn’t necessarily a minimum income required – it’s more about the regularity of the income and whether this will be enough based on your outgoings. So, it can vary on a case-by-case basis.

There are options if you’re unemployed or a student. For this, you’ll need to find a specialist lender. You can get help from a broker. Our partner CarFinance247 looks at all situations, so you can try our car finance calculator

What insurance do you need to finance a car? 

If you’re leasing a car or taking out a Personal Contract Purchase (PCP) or Hire Purchase HP) agreement, then you’ll need to take out fully comprehensive cover. This covers repair costs, even if you’re in an accident that was your fault.

The reason you’ll need to go with this insurance cover is that with car leasing you don’t own the car at any point. And with PCP and HP you don’t own the car until your agreement ends.

Do I need a deposit for car finance? 

Whether you need a deposit for car finance depends on the type of finance as well as the lender. If you’re using a personal loan to buy a car, you won’t need a deposit, as you borrow a lump sum of cash to buy the vehicle outright. Deposits are often required if you take out personal contact purchase, hire purchase, or a car lease.

However, many places will offer car finance with no deposit needed, including us. You can use a car finance calculator to see how much you could borrow without a lump sum. 

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*Representative example: Borrowing £6,500 over 5 years with a representative APR of 20.7%, an annual interest rate of 20.7% (Fixed) and a deposit of £0.00, the amount payable would be £168.48 per month, with a total cost of credit of £3,608.67 and a total amount payable of £10,108.67. Rates may differ as they are dependent on individual circumstances. Subject to status. We're a credit broker, not a lender.