Are you interested in getting a car loan to become an Uber driver but you’re not sure how to go about it? If you are, then you’re in luck as this article has been carefully put together to help you understand how to apply for a car loan successfully.
Let us make it clear at this point that these car loans are not restricted to Uber drivers alone but are open to other ride-hailing platforms in Nigeria like Bolt, inDriver and a growing list of others.
To make this easy and straightforward, we had a chat with the Finance & Digital Products Manager, Autochek, Okey Udo and he shed light on some vital areas of applying for a car loan for Uber.
Can Nigerians Get a Car Loan For Uber From Autochek?
It actually isn’t a yes or no question and this is because it is both “yes” and “no” and I will explain why.
It is a yes because if the individual applying for the car loan is a salary earner already and wants to get a vehicle to either use personally for Uber or to give it to someone else to use for Uber, yes, such individuals can get a car loan from Autochek.
Another yes is if the person has been an Uber driver for some time and has formalised the business by registering it with the Corporate Affairs Commission (CAC). Such a business has to be recognised as a legal entity. This would make the business owner qualify for a car loan.
The other one that is out there but isn’t fully structured is the individual who has been an uber driver for a minimum period of 6 months, a few of our partners “can” consider this category of individuals for a car loan on a case by case basis. This is because it is not fully structured but it can be considered.
What Are the Requirements?
The requirements for a typical salary earner include:
- Staff ID card
- Letter of confirmation
- Utility bill (to confirm where the applicant resides)
- Bank statement of account
- One of the following – Driver’s license, International passport, National ID card or voter’s card
Typically, How Long Does it Take to Process a Car Loan?
Upon the completion of the application, the initial offers come in within 6 hours of a working day of the week. The first offers will either be a rejection or approval of your car loan application.
Once the customer has accepted the offer, the duration between acceptance and disbursement is an average of 7 working days. It can be less if all the requirements from the partner are ready. What delays it if the customer has not fulfilled his/her obligations, has not made the equity contribution early enough, has not signed the contract, has not provided the direct debit mandate, has not provided his/her cheque book in cases where any or all of these are needed. The speed of the processing is more with the applicant than it is with the financing partner.
Are There Restrictions on the Type of Car I Can Buy?
This question is more about what are financeable vehicles. Financeable vehicles for us by definition must be foreign used vehicles. We have had a few exceptions to this. Some of our financing partners have age restrictions. For instance, we have a partner that doesn’t finance cars that are more than 12 years old. What this means is that this partner only finances cars that are 2009 and above.
However, typically, we can make an exception to some specific car brands to go as far as 2006 or even 2005 but typically, it is 2008 or 2009 and above. Some of the brands with this consideration are Mercedes-Benz, Toyota and Honda cars. These are vehicles that have very good second-hand value. For those brands, we can come down in terms of the year they were manufactured.
The other condition is that the car must have a minimum inspection rating of 4.0; nothing less. So, these are cars that are considered to be financeable vehicles.
Now that we have defined which cars can enter the pool, the next question is, what can you access as an individual? The vehicles that a customer can get a car loan for depends on what they can afford. Affordability can vary. An individual’s salary can accommodate vehicles with a higher value if they have a higher equity contribution. For instance, if they have up to 80% of the loan amount, they can easily apply for a car loan for the car in question.
We should also add here that the maximum that a customer can pay is 1/3 of their monthly income. What this means is that if the customer has running loans with other financial institutions, the monthly repayment on those loans already reduces your 1/3 because the repayment should also be from that 1/3. Whatever is left from discounting those other values is what you can access in terms of what you can repay at the end of every month. What can change this as I mentioned earlier is the equity contribution. The more you pay upfront, the lesser you have to repay.
How Long is the Repayment Period?
For Autochek, we do not have a minimum repayment period. A loan can be for 6 months or 8 months but on average, we have found that our partners are giving 24 months as a standard repayment period. If the car is brand new, you can get up to 3 to 4 years but for pre-owned vehicles, the standard repayment period is 24 months.
However, if you want the loan restructured to a shorter term, the partners can oblige. You should, however, note that your debt-to-income ratio, which is 1/3, should be able to accommodate the new repayment plan otherwise it would be 24 months.
Final Thoughts on How to Get a Loan For Uber in Nigeria
Getting a car loan is longer as stressful as it used to be. Now, you can apply for a car loan right from the comfort of your home and get multiple offers from Autochek’s car loan financing partners.
If you have plans to buy a car for Uber, simply visit https://autochek.africa, select a car you want, get pre-qualified and apply for a car loan. You can do this on the browser of your mobile device or by downloading the Autochek App. What are you waiting for? Get started today.