Turn Your Car into Cash: Discover a Loan for Uber, Lyft, and DoorDash Drivers Today!
8 Min Read
- Why Rideshare Drivers Have a Hard Time Getting a Loan?
- Why Independent Drivers Need Personal Loans
- What Loan Options Do Rideshare Drivers Have?
- How Online Personal Loans For Rideshare Drivers Work?
- What Are the Main Benefits of a Short-Term Doordash Loan?
- What Are the Requirements for a Cash Advance Loan?
- How Can You Prove Your Income as a Delivery or Rideshare Driver?
- Alternative Loan Options for Independent Drivers
Why Rideshare Drivers Have a Hard Time Getting a Loan?
Delivery app drivers working for Uber, Lyft, Doordash, and other companies find it hard to apply for personal loans or no credit check loans when they have bad credit history and are in need of money. And the reason is not that they have no unexpected expenses. They have a good share of business expenses on account of car maintenance costs and repair services. Most app drivers resort to a title loan by using their car as collateral to get a loan.
The issue with traditional loans for doordash drivers is simple: submitting a loan request is more challenging for independent contractors. And most app drivers are technically considered independent contractors. However, financial institutions are reluctant to lend to Uber and Lyft drivers. A rideshare driver’s job is not considered stable. Applying for a personal loan with banks or credit unions requires a fair credit score, which an Uber or Lyft driver may or may not have.
Fortunately, gig workers have alternative financial solutions like personal loans.
Why Independent Drivers Need Personal Loans
Independent contractors such as Uber drivers are not considered employees per se. In other words, getting approved for a traditional personal loan is next to impossible for them. Financial institutions often reject gig workers’ applications after a credit check or upon learning about the unpredictable nature of their employment history and status. To banks, non-salaried contractors are risky customers.
Unlike traditional loans for doordash drivers, personal loans depend less on credit scores, offering drivers the benefit of same-day approval. Moreover, the approval rate on such loans is high. Borrowers can receive the money on their checking account as soon as the next business day. Among the most popular reasons to apply for a personal loan, Uber and Lyft drivers often report the below:
- Financing car repair services;
- Paying for gas and maintenance;
- Funding car inspections costs;
- Covering car insurance costs.
What Loan Options Do Rideshare Drivers Have?
When gig workers need additional money to cover unexpected expenses, they have two quick options to get cash: a payday loan and a installment loan. Both are solution-tailored loans for rideshare service providers.
A cash advance loan from a direct lender represents a short-term loan amount that you typically pay off when you receive your next paycheck. Main characteristics:
Amount: up to $1,000;
Terms: up to one month (on your next payday);
Fees: from $10 to $30 for every $100 that you borrow;
Repayment: in one lump sum.
Short-Term Installment Loans
Payday installment loans are a form of short-term financing. This option is somewhere in between an unsecured personal loan and a cash advance. Unlike payday loans, you can take larger amounts of money and repay the lender over several months. Main features:
Amount: up to $5,000 (sometimes the loan amount is limited up to $4,000);
Terms: several months, depending on the amount;
Fees: depend on the loan conditions;
Repayment: in fixed monthly installments over several months.
How Online Personal Loans For Rideshare Drivers Work?
The application process for these online loans is straightforward:
- Get approved
- Receive the funds
If you apply for personal loan products on a typical workday, you can receive the money in your bank account within one business day. Although applying doesn’t guarantee approval, you will most likely qualify.
What Are the Main Benefits of a Short-Term Doordash Loan?
Uber drivers, as well as other representatives of the gig economy, enjoy numerous benefits when applying for doordash payday loans or personal loans, including:
If you qualify on the main set of requirements, you will receive your money in record time compared to traditional loans.
Quick Online Application
Customers usually complete the form in a few minutes. All you need to complete is personal information relevant to your identification, job status, and simple financial details.
Instant Loan Decision
Most drivers receive an almost instant loan decision because there is no hard credit check that could take time. On a typical business day, we’re talking about a matter of minutes.
Fast Deposit of Funds Directly into Your Account
Once you sign the loan agreement, you will have the funds in your bank account within one business day. If you get approval later in the day, the deposit will be processed the following business day.
With your prior consent, the loan amount will be automatically debited on the due date. That way, you don’t have to worry about missing your payment.
No Hidden Fees
Borrowing from reliable direct lenders doesn’t involve any additional costs like origination fees.
What Are the Requirements for a Cash Advance Loan?
To be eligible for a cash advance loan (or a personal loan), an Uber driver doesn’t necessarily need an excellent credit score or a good credit history, which is mandatory for personal loans. What you do need is to have the bellow:
- a state-issued ID (your driver’s license, too);
- your social security number;
- proof that you are a US citizen or permanent resident;
- an active bank account and recent bank statements.
A loan provider will look into your earnings and expenses to determine whether you will be able to pay them back.
Who can start an application process for cash advances? The service is available for most delivery company workers and rideshare drivers working with:
- Amazon Flex
How Can You Prove Your Income as a Delivery or Rideshare Driver?
Delivery and rideshare drivers are not considered employees but independent workers. For that reason, they do not receive pay stubs, which lenders require. As a rideshare driver or delivery worker, you can prove your income to the lender.
- Form 1099. As an independent worker who earned more than $600 the previous year, you get this form at the beginning of each year.
- Bank statements prove that your company transfers money into your account on a monthly basis.
- Monthly income summary. If your company sends employees monthly records of earnings, you can use yours as proof of income.
- Weekly earning screenshot. If your company has an app or website where employees can monitor their earnings, you can take a screenshot to prove your income.
When your lender asks you for proof of income, ask them what they accept. Different loan providers will have different requirements from gig economy borrowers. Expect additional questions about your health insurance type, your monthly expenses, including car maintenance costs.
If you decide to opt for no denial payday loans from direct lenders, keep in mind that when your lender asks you for proof of income, ask them what they accept.
Alternative Loan Options for Independent Drivers
A new driver’s first question is what it takes to buy a car as a ride share driver. And while Harry Cambell makes an excellent point of why that makes sense, the US Small Business Administration (SBA) may have some additional options on how to get low-risk loans.
As an independent contractor, you could benefit from PPP if you meet a series of required criteria. PPP loans are available for small businesses, which Uber drivers, Doordash drivers, and others qualify for.
Uber drivers are not employees of the company per se. As an independent Uber driver, you are eligible for an EIDL loan in case of a pandemic or other factors that affect your financial wellbeing.
Can an Uber driver get a payday loan with bad credit?
Yes, poor credit is not an issue when getting a cash advance. Bad credit loans are available for everyone.
What unsecured loans can independent drivers access?
Rideshare drivers can access small business loans, federal loans, and payday loans with no collateral asset. Some small business options may lend to app drivers in exchange for a part of their future sales.
Do Uber, Lyft, and Doordash offer loans for drivers?
No, Uber, Doordash, and Lyft don’t offer loans for their drivers. Uber ended its car financing program in 2017.
Are drivers and delivery workers eligible for small business loans?
Yes, they are eligible for small business loans in most cases, depending on the exact requirements.
Fuel Your Ride-share Business With A Loan From 1F Cash Advance! Apply Now And Keep Your Business On The Road.Apply