Excellent credit but unemployed. Can I still get a car loan?

[user1]

My credit score is over 800 but I am currently unemployed. Will I still be able to get an auto loan? Assuming I can, will my application negatively affect my credit score if I apply and report that I am unemployed?

[pizzadude]

---

@user1 wrote:

My credit score is over 800 but I am currently unemployed. Will I still be able to get an auto loan? Assuming I can, will my application negatively affect my credit score if I apply and report that I am unemployed?

---

Welcome to the forums !

I think that it will depend on what your "other" sources of income are right now.   If you don't have a job, what other sources of money, or assets can you demonstrate which would allow you to pay the note ?

How long have you been unemployed ?   Do you expect that you'll be able to obtain employment relatively soon ?

[user1]

I have the entire amount of the purchase price in cash but I would prefer to finance and keep the cash available for other purposes. 

I have been unemployed since November and expect a job soon but I can't wait until then to get the car. And even if I can get the loan I am worried that having to indicate on the application that I am unemployed will cause my credit score to decline. Currently it is over 800.

[pizzadude]

---

@user1 wrote:

I have the entire amount of the purchase price in cash but I would prefer to finance and keep the cash available for other purposes. 

I have been unemployed since November and expect a job soon but I can't wait until then to get the car. And even if I can get the loan I am worried that having to indicate on the application that I am unemployed will cause my credit score to decline. Currently it is over 800.

---

You don't have to worry about your employment status affecting your FICO score.   FICO scoring does not care about your income, age, race, employment status, sex, etc...

If you have enough cash on hand to pay for the car then that's probably going to help.   You might need to put a large downpayment on the car.    I'd recommend going into a local CU or bank and have a chat with the LO there, they can probably tell you if it's going to be a show stopper.

[user1]

Thanks for that info! I knew that I could buy a car somehow but my biggest worry was having my employment status affect my credit score if I applied for a loan. That makes me feel comfortable going ahead and applying.

[pizzadude]

Good luck !  Let us know how it works out !

[tisch0791]

If you work directly with one bank they might ask for proof of income like regular bank deposits showing you have a consistent flow of money.  They can be sticky about that.  If you work on financing at a dealership they probably will not ask for that information because they are working to do whatever they can to put you in a car.  I can say this from my very recent personal experience.  I had to provide lots of info to my CU to get an approval.  I brought this preapproval to the dealer at buying time but gave the dealership a chance to do better.  They did do better and did not ask me for a bunch of proof documents.

[jcstarkey8826]

hopefully your bank or CU is different, however the banks I work and have worked for cannot say, due to discrimination legalities, anything about whether an application will be declined or not based on anything you tell them, but it was/is my current banks policy to not lend unless you have income, and they would list DTI as the factor in the decision. Again, I hope your bank or CU doesnt have that policy, but of the 3 I've worked for and multiple connections Ive had to others, they are a stickler for income.

Basically you have the cash to buy the car, but that doesnt secure anything for them because you can still do as you please with those funds. all the best, let us know how it goes!

[Revelate]

---

@tisch0791 wrote:

If you work directly with one bank they might ask for proof of income like regular bank deposits showing you have a consistent flow of money.  They can be sticky about that.  If you work on financing at a dealership they probably will not ask for that information because they are working to do whatever they can to put you in a car.  I can say this from my very recent personal experience.  I had to provide lots of info to my CU to get an approval.  I brought this preapproval to the dealer at buying time but gave the dealership a chance to do better.  They did do better and did not ask me for a bunch of proof documents.

---

Interesting, Acura vis a vis Honda certainly asked for my proof of income, but admittedly I wasn't in a pretty FICO land to begin with there.   Dealers typically don't arrange the financing themselves, usually at least for reputable ones it's shopped to various lenders who may indeed have the requirement to demonstrate income.

I think it can be done anyway, a possible alternative to bringing paystubs, try with your the last two year's tax returns and that can demonstrate income (typical route for the self-employed) as well.

[guydiver]

I remember the dealer asking for place and length of employment when I financed my Ford last month, but that was about it.  I'm sure they wanted to be sure I had the ability to repay a 30K+ loan though.  Also, my current place of employment is listed on all three of my credit reports as well.  I don't know how much that factors into things, but as another poster replied, my CU is more sticky when it comes to DTI. They usually want pay stubs to calculate things.  I had to pay a 0.25% premium on my interest rate on my atv loan a little over a year ago because I had two auto loans(one was actually my daughter's car that I was co-signed on), so the DTI thing came into play. My Fico EQ was mid 750's then, so it was a pure DTI thing, emphasis on the "I" being income.  I would most definitely scope it out before having your reports pulled though, no sense in a hard pull if they won't finance for other reasons.  Good luck to you.