What is the minimum income needed for car finance?

Approved by the Car Finance Advisory Board

Do benefits count as income for car finance?

It's often wrongly assumed that if someone is on a form of benefits or tax credits, that they won't be accepted for car finance. However, as there is more of a risk for the lender, it's important that the customer can also prove that half of their income is from employment. If you're unable to prove this, then you're unlikely to be accepted for car finance.

Examples of benefits that can be used as part of your income are:

  • Carer’s Allowance
  • Local Council Tax Support
  • Disability Living Allowance
  • Tax Credits
  • Incapacity Benefit (long term incapacity)
  • Pension Credit
  • State Retirement Pension

Can I count my pension as income for car finance?

Most of our lenders will accept a pension as a type of income. This rule generally applies to people with both Good and Poor credit ratings. A person with a pension and a good level of affordability is generally considered a lower risk to a lender as a pension is a reliable source of income.

As a pensioner, if you have any form of proven annualised income this will be considered by our lenders. This can include things such as income from property and investments.

Can I get car finance on disability benefits?

There is slightly more flexibility with disability income and car finance due to the nature of the support. Someone with a disability may worry about the minimum income needed for car finance, but most lenders will try to be flexible to accommodate the situation and will accept the Government-funded Motability Allowance.

There is also a Motability scheme which is designed to help those with disabilities to get a good deal of support around their car buying process. Find out more about the Motability scheme here.

If you can’t find the topic you’re looking for here, please take a look at the rest of our Help section on car finance qualification, or talk to one of our Customer Advisors today by using our LiveChat service.

Published: 16/05/2016
Last Updated:04/02/2017
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