Are bank statements sufficient for proof of income? I'm a student and self employed. I work with small business's on tech work and I do occasional pet/house sitting (girlfriend has people who want us to pet sit (she works at a vet clinic) but I generally do them/ checks in my name).

So I went to look at a car and it passed the test. So I began the financing process and was told (from the dealer) that the lenders required POI and bank statements weren't valid. I've never heard of any lender/bank declining bank statements as sufficient POI especially which the account I had statements showed all my 'pay' or my deposits from checks/cash only. Any ideas?

I may just go to a local CU and apply.

 

I thought most car financing was based on credit score? Admittedly, I havent been a student for quite some time, so maybe the rules are different.

 

Im technically self employed as I am freelance...I have NEVER had to provide proof of income to buy a car. It was credit based.

I think if you're credit is horrible they will want proof. Otherwise, perfect credit = no problems.

 

I'm only 24 so my AAoA isn't long and I did have a couple hiccups when I was 18-20.

My credit isn't HORRIBLE but it isn't the best. It's like 650ish. FICO all 3 bureaus

They even denied my tax return as my proof of income.

I think we're having miscommunication or something cause even some lenders I've spoken with prior said bank statements are valid PoI.

 

A tax return is proof of income...not sure how that was denied.

 

Exactly. I feel like something fishy happened. I drove 100 miles in traffic to look at the car and possibly buy it. I had to head back home and they wasted my time.

 

I've never had a lender or agency suggest bank statements as PoI, although they are accepted as proof of assets.


When W-2 forms or check stubs aren't available, a copy of a filed tax return is proof of income.

 

Yeah. I got my filed tax return printed out for them and they told me this wouldn't work and didn't even look at it.

I'm going to call them tomorrow and make sure we didn't have miscommunication.

The only other thing I could think of an issue is that the dealer didn't want to sell me the car for the price they had listed.

Vehicle was a Hyundai Santa Fe Sports it was 'listed' on the dealer site for 21.5k-- Autotrader showed 17.6k and they said they would honor the price.

At one point, I felt like they just didn't want to sell me for the price that was listed. Not sure though, because I'd assume they would just tell me that they wouldn't honor the price. They have every right to change the price anytime they want until the papers are signed.

 

current paystubs are proof of income in this instance, not last year's tax returns

 

Go to your own CU and finance thru them.

 

They were going to honor a $4K price difference on a base of $21K I'm thinking someone misspoke and are worming their way out by giving you the runaround on needing PoI. Think about how many dealers put together deals for folks that have credit scores lower than yours on a daily basis - typically at a higher interest rate.

 

Well we'll see. There corporate office contacted me to ask me questions about the financing. They said they'll have the financing department at the dealer contact me today about a decision. We shall see.

I won't sign anything unless it shows 17.5k + TTL = 18.9k.

Anything more and I'm not signing it anyways.

Since the dealer is far away, am I allowed to have the dealer fax me the contract so I look it over thoroughly? Of course this all relies on what the finance dept. says today.

 

There is no reason why you wouldn't be "allowed," but they might not want to for some reason - I see no reason why they wouldn't but not sure why they are pressing you for PoI in the first place. As fsttyms1 mentioned above, why don't you line up your own financing at your local CU??

 

Yep they're playing games (not sure why), just go to a CU

 

I don't believe that is correct-- it sounds like issues with truth-in-advertising compliance. IDK if AutoTrader may also have a contractual issue with the dealership if it doesn't honor the advertised price.
Something to discuss with the dealer if other "problems" suddenly arise with the purchase.

My best guess is the price differential, in which case the dealership will mess with everyone who brings in the AutoTrader price.

 

I'm with you there and pretty messed up if true.

 

POI in car loans usually means Pay stubs.

I had Toyota and Honda asked me for it before. But They still approved me and said i can provide the POI later, which of course, i never did.

They will ask you for it if they are suspicious with the gross income you provided on the application, but usually they will let it go if your credit score and history are strong enough.

 

I say line up the financing with a CU beforehand. Then you have all the power to negotiate.

 

pay stubs on a contract self employed individual is tricky. Tax returns would give a bigger picture of previous income, but even a single year can be pretty variable. I'd imagine they'd want to look back a couple years to get an idea of the financial situation.

As mentioned, line up your own financing through your bank or CU...

 

It sounds like going though the CU will be your best option. When I got my car last year, POI meant showing the dealer my paystubs.

 

All of the cars I bought/leased, I've never had anyone ask for POI. Even in 2002 when I was 18 and bought a new Tahoe.

 

The issue is that he is self employed. Think about it from the bank/lending institution's perspective.

 

I had this issue buying both my cars when I had my old job. I had an LLC and a contract thru the company I worked for. I basically had a check each month with an invoice made out to my LLC, and I went from there. Most banks wanted two years tax returns to prove income, however I hadn't been in that position long enough to have one years return. On my first car (2007 Infiniti FX) the CU let me use my bank statements. When I was looking at Benz's (first 2012 Merc C350), one CU would NOT take bank statements along with my pay invoices (even though I had every one from my time with that company, one years worth of stubs) but a different dealer (second 2008 Merc C350) never asked for any proof of income...at all. I stated my income on the loan app, applied and got it, and never had to go to a bank or anything like that to prove income. Honestly it just depends on who you're dealing with at each establishment. They're all going to be different, but it can be done.