Auto Loan advice for a 1099 employee

[IrishPM]

I've been a 1099 employee for the past 2 years and one of the things I recently discovered is it is pain in the neck to obtain a car loan. I have a perfect 23 year credit history, perfect payment history, CC utilization under 18% and average income of $144k per year. I applied for an auto loan through my bank, Wells Fargo, and they requested two pay stubs with a running total. I submitted my two pay stubs that show a running total for January and February 2019 and clearly indicate I'm a 1099 employee because there's no deductions. Wells Fargo rejected my submittal. I also included the total direct deposits ($289,459.00) made by my Employer to my checking account to prove my income was legit. That didn't work either. The auto loan specialist from Wells Fargo called me on Saturday and basically said that in order to qualify for a loan I would have to bring in my tax returns for the last 2 years including Schedule C and Form SE. I have filed my 2017 return and have not yet filed my 2018 return so it appears that I'm stuck in neutral until I complete my tax return for 2018. What really gripes me is that Wells Fargo admitted to me that they see all of the deposits made to my checking and savings, I've never bounced a check and have a healthy credit history and credit score. Why do they make this so difficult? 

[DaveInAZ]

Why do they make this so difficult? Because Wells Fargo can be clueless idiots and can make the simplest things unnecessarily complicated. I applied for a credit card several years ago with them and they responded with a demand for last two paystubs and last year's W-2. At the time I banked with them and my payroll direct deposit was going into my Wells checking. I pointed that out to them and they responded "that doesn't matter, last 2 paystubs & W-2 is our standard policy". I told them to cancel the application, and ended up closing my accounts.

Just go to a car dealer and when you have the car & deal you want let them arrange the financing for you. I bought a car in Sept. 2017 and they placed my loan at a very good rate and I never provided anything more than my stated income. Credit scores in the 720s.

And move your banking to a better bank.

[Anonymous]

I agree the car dealer will know who to submit you with - which banks are easier for 1099 vs employees.

You can try Capital One Auto Navigator for preaproval or a good credit union.

[Anonymous]

It really has nothing to do with Wells Fargo being a good or bad bank. For 1099 contractors who do not get W2’s every single bank will ask for either tax returns or 3 months personal bank statements for a loan. Try Capital One. They are easy. You upload 3 months personal bank statements and you get an instant approval.

But as someone suggested the easiest route is to get financing from a dealer. They will have several banks that you don’t have to provide anything. (Assuming your credit score is 670 or above).

The downside dealer financing is multiple inquiries on your credit report.

[IrishPM]

Update. I ended up canceling my app with Wells Fargo and opted to use Capital One as someone suggested. I applied online and was approved within 30 seconds. The only items I was required to bring to the dealer to complete my purchase was my driver's license, proof of insurance and my downpayment. From the time I completed the online application to the moment I signed the loan documents at the dealer and picked up the used vehicle, it was less than 18 hours. I've read horror stories people have written about Capital One Auto Finance but I have to say that this is probably one of the best car buying and auto finance experiences I've ever had. 

[Anonymous]

Awesome! Did you have to upload any proof of income?

[Anonymous]

IrishPM,  I had almost the same a couple months ago. What did I do? Considered about online loans and took 2 separate loans. But taking them, you should be careful with terms and analyze everything.  (Mod cut - sorry, such external links are not permitted here).

[Lucifer]

I used Cap 1 Auto on my last car loan.

Easy Peasy.    I brought good credit to the table but barely any downpayment.   

I have had to get other loans.....As stated above, I let the dealer help me find the right lender.    The worst I have had to do is upload a couple years with of tax returns.

Glad it all worked out for you.   I found Cap 1 Auto to be a good experience all the way through to the end.

[355F1]

I’ve been a 1099 employee for 11 years.

I’ve purchased a BMW, Honda, Ferrari, & 2 Lexuses during this time period with zero hiccups.

Find a new lender.

What is your credit score? How much of a loan are you trying to get??

[Anonymous]

My advice is to say *BLEEP* YOU! To Wells Fargo. They are under penalty over the whole scandel. Credit Unions will be more willing to work with an individual. You want to have a bank that values relationships.