Most vehicles in the UK are bought with motor finance, and this is true of cabs, too. When you are thinking about your next taxi it pays to be aware of what finance lenders will look for when they assess your application. Here are the main things to consider.
The lender will want to know that they have the correct address for a customer and will use the electoral register to confirm it. It is key that a customer registers themselves on the electoral register as soon as they change address. It will tick the 'traceability' box and improve their credit score. The lender will also check for entries on the credit register as evidence of the applicant being at the address. However, if the customer is not on the electoral register, they will need proof that they live at the address, perhaps by providing a recent utility bill or bank statement.
The taxi trade has traditionally operated with cash and, despite the vast range of Electronic Payment Technology now more widely available than ever, the use of cash is still widespread. If cash is not deposited via a Bank or Building Society, proving a cash flow, it can often cause issues when applying for loans, due to the lender being unable to confirm that a customer has the income to afford a purchase. This is a key factor in the lender’s decision making process.
However, lenders also use other ways to assess the affordability of a loan. For example a lender will often ask for gross annual income and will assess any information detailed on the credit register to see if a customer has had experience of a similar size loan to that which is being applied for. In the absence of this they may ask to see the last three months bank statements. To summarise the key affordability indicators for lenders:
The Taxi Shop has worked hard to establish relationships with lenders who may consider customers with previous issues on their credit file. If a customer has had credit issues you can be assured The Taxi Shop will investigate the case fully to try and assist with the purchase of a new vehicle.
Lenders understand that anyone can go through financially difficulties from time to time. But it is important that a lender can see that there have been attempts to repay the debts. It is also crucial to repay any historic debt as well as ensuring current financial commitments (however small) are kept up to date. These types of actions will be key in demonstrating their financial position is now operating properly.
Use our free credit checker to find out what you can afford.