If you don't own a car but have every other document that allows you to drive for Uber, then Uber provides a number of interesting solutions.
Uber has partnership program through a subsidiary Xuberance Limited. Xuberance provides financial services under the heading "Partner Point" and acts as a credit broker, not a lender. Partner Point will introduce applicants and drivers to a limited number of finance providers to enable you to either rent or lease a car.
My tip: Uber is not known for providing the best deals all the time, check the market properly, so you are sure your car costs meet your expected income targets.
Partner Point (Xuberance Limited)
This company provides some auto-finance options that include buying, leasing, and renting a car. They provide a team of auto and auto-finance experts that sit with the applicant and help the applicant decide what the best solution within the applicant's budget is.
Choosing the right Vehicle
Driving for Uber is actually driving as a business owner. You are not an Uber employee, you are, by EU Court decision a taxi driver, and as such, you own your own taxi service. They call this a private hire company and you will get a private hire license to operate your business, which is driving for Uber.
If you don't own a car, then you have to consider the cost of either buying, leasing, or renting one. As with all businesses, there is an investment to be made in capital expenditure (Capex), a car is capex, and you need to consider all the aspects of the budget that includes car purchase price, car expenditure (insurance, maintenance, depreciation, loan interest rates, running costs, etc.). The three questions you need to ask yourself are:
How long do I want to drive for Uber?
Are you going to do this for three years or only a few months? Which will set the car ownership option? For someone that intends to work with Uber for more than two years, it would be advisable to lease a car unless you own one that is unacceptable. Then you would either sell your old car and use the income to make a down-payment, and take a loan/lease to fill the missing amount.
If you don't own a car, then you would best, choose between a bank loan or an Uber partner lease option. If you intend to work for a short time, under a year, then renting is your best option. Unless your intent to buy or rent one anyway. Then using Partner Point is a good option to improve your chances for eligibility to get a car you might not be credited to get if you were not working for Uber.
What is my initial budget or investment amount?
How much cash do you have to make your initial down payment, and what other sources of income do you have. These will be taken into consideration when planning a monthly installment schedule. You must consider all the variables, such as insurance to cover illness and accident time, you do not want to be stuck with an expensive lease and no money to cover the installments.
What will be my Uber work schedule?
Do you intend to work part-time, full time? Every day? Weekends and Holidays? Work out how many working hours you are ready to commit to your life to Uber driving. This will also help you determine which car category you want to take.
The only advantage that Partner Point offers is to individuals with low credit ratings. This means that if you cannot get financing due to your low credit rating, or can get financing at exorbitant fees and regulations, then you are stuck. However, Partner Point takes the fact that you will be earning money while driving for Uber and they will deduct your monthly payments directly from your income, securing their payment and ensuring you also get paid for your work.
Here are some of the solutions that Uber provides on their site.
These include anywhere between 1 to 12 weeks and offers a more flexible alternative to part-time drivers that don't own a car or cannot use the car they own. Renting enables a car owner to use another acceptable car without getting involved in buying a new or used car just for Uber driving purposes.
All rental companies require a credit card, so if you don't have one, you have an issue here. If you have a credit card, then this is the perfect short-term solution. Rental companies will charge anywhere between £250-£500 down payment; this is not in cash, it is via the credit card. They do not take the money from your card; it is a part of your credit cards credit level, which is held by the credit company in escrow until the rental agreement is concluded. It is used to cover any extra expenses that might occur during the rental period to cover damages.
Since rental option prices vary, there is no point in providing examples. The best way to get an up to date estimate is to contact Partner Point to find out the latest rental deals they can offer.
If you don't own a car and want to lease one, Uber will help you find a viable solution to suit your budget. Leasing is also a good option if you own a car that is unacceptable to Uber and want to replace it with an acceptable car. Leasing gives you the time to buy with easy payments. You can even trade-in or sell your old car and use the collateral as a larger down payment which will either reduce the monthly installments or shorten the time of the lease plan, whichever suits your purposes.
This is basically rent to buy, the main difference between this and full leasing is that you have a choice to either own the car at the end of the lease or return the car as if it were rented. All the other terms here are identical to full leasing. The flexible-lease option differs from a car loan in that you don't make an initial down payment; you make the last payment a large "balloon" payment to cover the final purchase cost if you intend to own the car at the end of the contract. Most low credit scoring individuals choose this option since it enables them to "buy" a car while driving for Uber. In fact, driving for Uber is a great way to buy a car.
Here is an example of a Flexi Lease from the Uber Partner Point site:
- The cost starts from £199 per week.
- The cost includes VAT, insurance & services
- You make a £600 non-refundable advance payment when placing the order
- Your first-week payment is £199 made when you collect the car
- The payment schedule is for 36 months, payable weekly and is taken via Uber direct payment
- The lease includes 40,000 miles a year
- You get tire replacement discounts
- It includes express servicing - You also get free of charge PDO licensed vehicle replacements for up to 14 days for all maintenance or insurance claims
- The lease includes PCO license costs and bi-annual MOT price
If you have financial resources, then obviously it is cheaper and better to buy a car in one lump sum. The decision to buy a new one or a used one is personal. Depreciation and technology are the factors that you must consider before buying a car. Also, depending on which category you intend to work for, consider the options as the more expensive the car, the higher the risk you are taking, but your income increases exponentially the higher you go. In other words, UberX drivers work long hours to get their income, UberLux drivers work shorter and more sporadic hours, but get a heck of a lot more money for their services.