Ways To Show Proof Of Income
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Ways To Show Proof of Income For a Car Loan

Different ways to show proof of income

To obtain a car loan to finance your new car, you must be able to have proof of income to get approval for a car loan. You will be required to bring standard documentation to the lender to help asses your personal and financial situation to get a car loan approval. 

Proof of income is required for credit checks for contracts with long-term installments. The documents recognized as proof of income and creditworthiness varies.

As part of the credit check, contractual partners almost always ask for proof of income – regardless of whether you want to rent an apartment or take out a loan. Employees, the self-employed and recipients of state benefits can and must use very different documents. Below are ways to show proof of income for a car loan for salary employees, self-employed business owners and state check, recipients.

Proving your income on salary

Anyone who is employed and therefore has a fixed monthly salary has three options in principle, which he can submit to prove his solvency:

The simplest and most meaningful – and therefore also standard – is the proof of income by submitting the payslips of the last three months. In some cases, the associated bank statements are also required, which document the incoming and outgoing payments on your account.

The employment contract is rarely requested as evidence because it is difficult for your contractual partner to see what you really earn – after all, allowances, tax classes and the like are not mentioned here. However, an open-ended employment contract is usually a plus in the credit check.

You can obtain your certificate of earnings with a request from your employer. As a rule, this is straightforward. 

Proving your income when self-employed:

As a self-employed person, you have to put in a little more effort when you go through a credit check. Because, unlike employees, you usually don’t have constant monthly earnings. In order to prove your financial resilience, you can use the following accounting documents as a freelancer or entrepreneur:

  • Business evaluation forms

      • You can show monthly or quarterly earnings. You can show the revenue your company brings in.
  • Revenue surplus account

      • Having a surplus of revenue in your account is a strong indication of a healthy business
  • Tax assessment.

      • You can provide the potential lender with your earnings filed on your company or personal taxes. 

In contrast to employees, who normally only have to prove their earnings for the past three months, the self-employed usually take a longer period of time to obtain meaningful information. As a rule, proof of income from the past two to three years is required. This is often difficult, especially at the start of self-employment. In such cases, your tax advisor can help you create meaningful documents.

The problem is always: tax assessments always only show past data. If you currently still have income from renting, leasing or assets, you should submit the relevant evidence.

Proving your income of state benefits:

  • Showing approval notices

      • From unemployment benefits to old-age pensions, there are a variety of state benefits that count as income. If you make a living from this, the approval notices for these benefits are your proof of income. They are issued by the responsible office.

Obtaining a car loan without proof of income

Note that depending on the car loan you request, the number of supporting documents required will not be the same. It is necessary to differentiate two main forms of car loans which are the restricted loan and the non-allocated loan.

To reduce the number of documents that are required in order to grant you a loan, you have the option of applying for a personal loan. A personal loan is an unrestricted loan, that is, you do not have to justify the use of the borrowed amount.

Reading the advantages of unallocated auto credit (personal loan), you wonder why many people prefer conventional consumer credit? The answer is essentially two points.

First of all, a consumer credit with an allocation is often granted with more attractive rate conditions. The unrestricted personal loan allowing the free use of the sum is riskier for the lender. In contrast, therefore, the affected loan has a clear and verifiable justification, the credit rate granted is therefore reduced.

The second advantage of a consumer credit whose amount is allocated to a specific purchase: you are protected by the consumer code! The consumer code only concerns the credit allocated to a specific purchase and therefore does not protect borrowers who take out a personal loan to buy their car. Why is this point important?

Because it means that the completion of the loan is coupled with the completion of the sale. Therefore, if you face a dispute at the time of purchase, then you will be fully covered by the law. You will only start reimbursing your car when it has been delivered and fully complies with the contract.

This will not be the case with a personal loan. If a problem occurs at the time of delivery (missing accessory, non-compliance, the problem of use), you will still begin to honor your monthly car loan payments. Even if the sale is canceled and the car is not delivered, you will be forced to pay the monthly deadlines! In reality, you will have to pay your credit as if you were in possession of the vehicle.

As we have just seen, it is possible to obtain a car loan by limiting the number of supporting documents, and in particular by not communicating an order form (both for a new car and for a used car). However, you should be aware of the risks of this operation.


With this guide, you will be able to show proof of income while applying for a car loan. You can buy any car with the amount loaned to you with the options you want. You can use all or part of the amount, or you can use it to partially finance the purchase of your new car. You have complete freedom to use the funds without having to produce any supporting documents (purchase order). This is the reason why unrestricted credit is also known as non-supporting credit. Are you having trouble getting a car with no credit or bad credit? Then let us help you at 500 Below cars where are in-house financing team will be happy to help you. 

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