Can I get a car financed with no employment history?

You can still get car finance without a job, but it’s often more challenging. Car finance companies assess loan applications based on the applicant's financial situation and credit score. They emphasize the importance of applying only for loans that align with what you can realistically afford, as these companies will only offer approvals for amounts that can be comfortably managed by the borrower. Therefore, you may need to provide additional proof of income from other sources since you don’t have a work history.

If your credit history is good, this process becomes easier for you. At Carplus, we work with many lenders, so we’ll do our best to find one willing to help. Having a guarantor—a person with a good credit rating and stable employment—can also improve your chances. A guarantor agrees to cover your payments if you can’t, giving the lender extra reassurance throughout the loan term.

What If you have just become unemployed?

If you’ve just lost your job but have a good credit score, you might still get a car finance deal, though at a higher interest rate. Obtaining a car finance deal while unemployed presents challenges, but there are possibilities. A deposit helps show lenders you’re serious about repayments.

If your credit score isn’t strong, car finance is still possible, but rates will likely be even higher. A deposit is key here to reassure lenders of your commitment.

I have enough money in my account, so can I get car finance?

If you have enough savings to cover a deposit and monthly payments, you could still get car finance. However, interest rates might be higher than if you were employed.

Can I get car finance if I'm on benefits?

Yes, you may be able to get car finance on benefits, and the process is designed to be straightforward and accessible. Not all lenders accept benefits as a form of payment, so it’s essential to check eligibility. If your benefits are too low or your credit history isn’t strong, a guarantor can improve your chances.

Can I get unemployed car finance with a guarantor?

Yes, a guarantor can help you secure car finance even if you’re unemployed. Purchasing a car outright while being unemployed can be challenging, but financing options can make car ownership more manageable by spreading the cost over time. If a lender needs extra assurance, having an employed partner or guarantor on the loan can increase the likelihood of approval. This person agrees to cover payments if you’re unable to, which gives the lender more confidence in approving your loan.

Partner has a good job, but I don't. Can we get car finance?

Car finance is still possible if only one partner is employed, but it may be more challenging. Lenders prefer applications where both partners are working, but a single income can still be enough for approval.

Individuals who are claiming benefits and exploring car finance options may face additional challenges. Many people rely on benefits for various reasons, and accessing finance for a car should not be hindered by one’s financial situation, as transport is crucial for attending important commitments.

To improve your chances, ensure your partner has a steady job with a reliable income. While lenders will consider your work history too, being unemployed doesn’t mean automatic rejection—though a long period without work may complicate things.

A larger deposit can also boost your application, as it shows commitment to meeting payments. Following these steps could help you secure car finance, even if just one of you is currently employed.

Is age or credit history a factor?

If you're over 21, you may qualify for car finance. If you're under 21, a guarantor is often required, as younger applicants are generally seen as higher risk due to limited income history.

Age can influence car finance approval, as lenders may view younger applicants as riskier compared to older applicants with established income records. However, being older doesn't guarantee approval—lenders will still evaluate your financial circumstances and credit history closely.

Improving your credit history and financial stability can strengthen your application at any age, increasing your chances of getting approved.

What should you consider before securing car finance with unemployment?

First, ensure the monthly payment and interest rate are affordable within your budget. This will help you plan financially with the car loan in mind. Look at the APR (Annual Percentage Rate) to understand the total cost, as it includes both the loan amount and interest.

Hire purchase is a payment method where a buyer pays the full value of the vehicle through monthly installments, ultimately becoming the owner upon completion of payments.

If the monthly payment feels too high, consider a longer loan term to reduce each payment. Remember, though, that this also means paying more interest over time and making more payments.

Who should you avoid at any cost?

Unregulated lender

Some lenders are not regulated by the Financial Conduct Authority, meaning they don't have to follow standard rules. These lenders often charge much higher interest rates, increasing your financial risk.

Loan sharks

Loan sharks operate illegally, charging extremely high-interest rates. They may also use threats or intimidation to collect repayments. Avoid these lenders to protect yourself from potential harm.

Lenders advertising guaranteed car loans

Be wary of lenders promising “guaranteed” car loans. Despite their claims, these lenders may still require a good credit score or a deposit, so the offer isn't as guaranteed as it seems.

Payday lenders

While payday lenders may offer car loans, their interest rates are typically very high. These loans can lead to unmanageable debt, so it's best to consider alternative options.

Logbook loans

Logbook loans use your car as collateral, meaning the lender can repossess it if you default. This type of loan is risky, as you could lose your vehicle if you struggle with repayments.

Tips to get car finance if you are unemployed

1. Start by registering on the electoral roll. This proves your address and helps lenders verify your identity, making you a more reliable candidate.
2. Next, check your credit report for any errors before applying. If you spot inaccuracies, contact the credit reference agency to have them corrected in advance.
3. Improving your credit score can also help—try to pay off any outstanding debts. This shows responsibility with finances and can boost your reputation in the eyes of lenders.
4. When applying, make only one formal application. Multiple applications can make lenders think you’re seeking several loans, which may harm your chances.
5. If possible, consider a joint application with a partner. This can strengthen your application, but both parties should be aware that your credit history may impact the other person’s credit score and borrowing options in the future.
6. Explore Personal Contract Purchase (PCP) options. PCP allows you to pay for the depreciation of a vehicle over the duration of the contract, providing flexibility at the end of the term. This can be a more affordable option compared to traditional purchasing methods.

Contact our professional brokers

If you're unemployed and need car finance, our expert brokers at Carplus are here to help. Our team can assist you in finding competitive deals with favourable interest rates, guiding you through each step of the process to ensure you secure the best possible offer. Let us simplify the journey and support you in making an informed decision.