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Why might my application for electric vehicle financing be rejected as an individual?
Unsurprisingly, putting together a leasing application so that it is accepted by a car leasing finance provider is not always easy. There are a number of conditions that need to be met for your application to be approved. It also works the other way round: there are a number of things you don't have to tick to have a chance of getting your application approved by the finance company. We've listed them below:
Depending on your professional status:
- I am an autoentrepreneur
- my income is not high enough
- my income varies from month to month
- my income is not sustainable over time
- I'm a temporary worker
- my income is not stable enough
- my income is not sustainable enough
- I have a fixed-term contract
- my income is not sufficiently sustainable
- I have a permanent contract
- my income is not high enough
- trial period still in effect
Depending on your personal situation :
- the financing organisation may consider that you are spending too much in relation to your income / you suffer from a poor image
- you've had a banking incident and the banks have put you on file as having too much debt
- if you are not French and your residence permit expires before the end of the rental contract
- if you have had payment problems with your lender: you are on the credit register.
- if you are under 18 or over 75 by the end of the contract
- You are above the maximum authorised debt ratio in France, which is 33 %
- You have too little left to live on
Now that we've listed the reasons why you might not be able to finance your vehicle, we'll look at what you can do about it.
How do you resolve the issues that are blocking the case?
To solve your so-called "short-term" problems, which will be resolved within a certain period of time, we recommend that you be patient. Wait until you have fully met the conditions that will allow you to access the financing method. If you think this is a mistake and you are solvent, provide official documents to prove your solvency.
When it comes to the more long-term, binding elements of your file, it will be more difficult to ignore them. But it's not impossible! To get round these "long-term" obstacles, you'll need to find a guarantor or apply with a flatmate who meets all the conditions, to reassure the funding body. This flatmate must be a close relative:
- husband/wife, civil union or married
- parents: father and mother
Why might my application for electric vehicle financing be rejected as a professional?
As far as professionals are concerned, there are even more obstacles to realising your financing project for electric car.
Your electric vehicle leasing may be refused if :
- your business is too new
- your company is in poor financial health
- you generate more financial charges than profits
- you are not domiciled in France
- if your company is in receivership
- if the State/Banque de France has lent you money
- if your activity is contrary to the customary use of the vehicle (you may not sublet your vehicle or transport people with it)
- if the chairman of the company has a less than reassuring financial history (former company bankruptcy, unpaid bank loan, etc.).
- in the event that the company's main decision-maker is not on the territory
- when your company is in a market that is failing or not buoyant
Granted, that's a lot of obstacles to avoid, but it's best to be aware of them so you can dodge them as best you can! That's the next point, and we'll be giving you the tips you need to get around these obstacles if they concern you.
How can I get rid of the obstacles blocking my financing application?
There are a whole host of ways of getting round the elements of the file that could be prejudicial to you. To do this, you will need to prove your solvency, just as private individuals do. Show that you are able to pay all your monthly repayments.
To do this, you'll need a whole host of official documents to prove that you are in good financial health now and in the long term.
For companies considered too young :
- You may find it useful to provide a provisional or interim balance sheet that has been validated and checked by an accountant.
If your business has recently received government assistance, there are several solutions available to you:
- prove that you are solvent by means of any document attesting that you have a recurring income,
- wait 6 months to send a provisional/intermediate report,
- wait 1 year and send a new assessment,
The key is to prove that you are in a position to invest.
If your decision-maker is not on French territory, you can simply make a power of attorney on behalf of the decision-maker, in the name of another person located in France.
What documents do I need to send when applying to a finance company for electric car leasing?
Depending on the type of applicant, your application will have to include certain additional or additional elements. But they will remain broadly similar, with a few exceptions. We'll give you the details of each application according to your situation.
Documents to be sent by private individuals
Here is the list of documents you need to send to complete your application as an individual:
- GNI
- copy of residence permit if non-EU nationality
- copy of identity card or driving licence
- copy of latest tax assessment
- copy of last pay slip
- copy of proof of address
- copy of a cheque
- certificate of mileage allowance
Documents to be sent for a sole proprietorship (liberal profession, commercial agent, own-account business)
Here is the list of documents requested when you apply for financing if you are a sole trader:
- GNI
- copy of residence permit if non-EU nationality
- copy of identity card or driving licence
- copy of latest tax assessment
- 2035 declaration or 2042 declaration for the liberal professions
- copy of a cheque
- simplified balance sheet for sole traders
- trades register
Documents to be sent for a legal entity (company, sole trader, administration, association)
Here is the list of documents required when you apply for financing for a legal entity:
- GNI
- copy of the manager's residence permit if non-EU nationality
- latest published financial statements (Cerfa file: assets, liabilities, income statements, appendices 8 and 11)
- K Bis or trade directory for companies
- articles of association for associations
What are the prerequisites for my application if my company has only recently been set up?
Given that your company is young, financing organisations see a potential risk in granting you a leasing contract. So you'll need to meet a number of prerequisites to reassure the organisation and prove that you are solvent.
You will need a minimum of €10,000 in fully paid-up share capital (you will need to provide a bank certificate of deposit). You will be required to pay a deposit (or an increased first rent, depending on the financing organisation you choose) of 15 % of the investment value.
You will need to open a line once the deposit has been cashed (except for bank cheques). The average investment value is €20,000 for a maximum of three vehicles. The maximum single investment is €40,000.
Information on security deposits
DGs (Guarantee Deposits) are to be paid only by bank transfer or cheque to the financing organisation (traditional cheques are not accepted), before the order is placed.
DGs must be paid exclusively by the applicant himself, and not by the contributor, any broker or any third party. Transferring the DG is not recommended in the event of renewal, as it does not cover the same risk and will not be accepted even in exceptional cases.
What are the prerequisites for my application if my average investment value is high?
There are additional prerequisites:
- You are subject to a veracity check. You will receive a call from the CDC (Caisse des Dépôts) after it has retrieved your details by its own means to check the veracity of the order. The purpose of this is to avoid any identity theft.
- You will need to provide a certificate from a chartered accountant, stamped by the firm of chartered accountants and signed by the chartered accountant, who must give an opinion on the authenticity of the accounts.
- For all requests with an investment value of more than 100 k, a meeting between a member of staff and the customer is required at the place of business.
What are the prerequisites for a loan aimed at individuals?
Once again, certain minimum conditions must be met in order to be eligible for financing:
- Applicants must be aged 18 or over at the start of the contract and under 75 at the end.
- Your trial period must be over and you must have a permanent contract.
You must have stable accommodation, which must be in your own name, and you must not be staying with a third party. - If the value of the investment, in this case the vehicle, is over €20,000, then your net income must be over €2,000. For a household, net income must be over €3,000.
- For an investment value of less than €20,000 (which will be the case if you wish to acquire a Dacia Spring for example), the applicant's net income must be over €1,600 and €2,400 for an entire household.
What is the tolerated debt ratio?
A tolerated debt ratio is often set according to the applicant's monthly income.
It will vary from one person to another, but here is a rough guide to give you an idea:
- The applicant's monthly income is between €1,600 and €2,500 or the household income is between €2,400 and €3,500.
- the maximum authorised debt ratio is 33 % of total income
- The applicant's monthly income is between €2501 and €3800 or the household income is between €3501 and €4800.
- the maximum authorised debt ratio is 40 % of total income
- The applicant's monthly income is more than €3,801 or the household income is more than €4,801.
- the maximum authorised debt ratio is 45 % of total income
For more information, we've put together a guide to this topic to explore the different aspects in depth:
Read our article about :
Now you know everything there is to know about putting together a financing package. If you have any questions on this subject, don't hesitate to send them to us in the comments section! Our experts will try to answer them as soon as possible.
