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How Uber is helping me pay off my car loan

I put away $200 a week by driving a few hours every weekend.

When I made the decision to buy a used car from my sister, my experience with Uber’s ridesharing service was limited to weekend trips to and from the city. And while I liked using it, I never thought I would be a driver — until I started looking for ways to put more money toward my car loan.

Finding my financing

As a writer and personal finance expert for Finder in Australia, I knew finding the right loan wasn’t going to be my biggest problem. I used a personal loan calculator with each of the lenders I compared to make sure the repayments would be affordable.

I compared both fixed- and variable-rate loan options and kept their restrictions in mind since I wanted to make additional repayments and possibly pay off my loan early. And while the car I was purchasing was relatively new, it wasn’t eligible for many secured car loans.

After comparing my options for a few weeks — and with the luxury of an easy sale from my sister — I settled on an unsecured variable-rate personal loan that came with no penalties for additional or early repayments. While I could afford repayments over a two-year term, I opted for a three-year term, wanting to give my budget a bit of breathing room.

But despite that, I wanted to pay the loan off as quickly as possible — so I needed to find an easy way to earn a little extra cash and repay my loan ahead of schedule.

The decision to sign up with Uber

People are always looking for ways to save up cash to make extra loan repayments, and now I was one of them. Making my lunch and bringing it to work every day — while good for some — wasn’t going to help me save the type of money I wanted. So I looked elsewhere, and then I remembered the Uber driver sign-up ads.

“Be your own boss!”

“Work your own hours!”

Sounds like a dodgy Internet ad, doesn’t it? But the lure of Uber was real, and I wondered if this was a viable option to help work however many hours I wanted and put what I earned toward my loan. With my editor’s blessing, I decided to investigate how to sign up with Uber.

What happened when I signed up with Uber

Here are the two main steps I had to take when taking the plunge to drive with Uber:

  • Create an account online. Your driver account needs to have a different email address than what you used with your rider account – it took me a while to figure this out, but the customer service team was helpful.
  • Visit an Uber signup center. I then needed to visit an Uber signup center with my license, passport, RMS driving history, car insurance details and my car.* I had to pay for my RMS driving history, but those costs were reimbursed when I signed up as a driver. Uber had several signup centers in my area, with locations and times changing week to week.

* This was the policy in Australia as of December 2015. The process for drivers in Canada may vary.

At the Uber signup center

I visited a center with my documents and car. I was greeted by a friendly Uber rep and given a presentation about the app used by drivers, eligibility requirements for drivers and a bit about Uber’s philosophy. I was then taken to an office so we could go through my documents.

The whole process was quick. The most time-consuming elements were the vehicle inspection and filling out documents for a background check. While everything went well, my newly purchased car didn’t quite pass the vehicle inspection. But with some kind advice from the inspector and a business card for an auto mechanic, I was on my way.

What I learned at Uber’s signup center

Here are a few key takeaways from the presentation I was given at Uber’s signup center:

  • Uber needs drivers. Uber has more passengers than drivers and is in need of new signups. As long as you meet the eligibility criteria to be a driver, company reps can help you through the process and get you working quickly.
  • The work sounded enticing. While I was unsure about working as an Uber driver at first, the presentation was pretty convincing. You can work when you want, take breaks when you want and you’re paid weekly. The whole structure is transparent. The presenter said quite a few times that you would be working “with Uber, not for Uber.”
  • There are eligibility criteria. You need to be over the age of 21 and have held an unrestricted license for at least 12 months. Your car also needs to be less than 10 years old.*
  • It’s easy to make money. There’s a minimum $30 per hour* guarantee for drivers in the first few weeks they work, but the presenter said this usually isn’t needed because of the number of ride requests. He also said that surge pricing — where the cost goes up during periods of high demand — makes it easy to get higher fares by picking up riders in underserved areas.

*Eligibility requirements and minimum wages for drivers in Canada may vary.

What happened after

A few days after the failed vehicle inspection and a kind message sent to my equally uninformed sister about her misaligned front tires, I received a call from Uber saying I had passed the background check and could become a driver pending a successful vehicle inspection.

While the need to visit a mechanic slightly deterred me, the vision of zipping around the city for a few hours each weekend hadn’t faded yet. If you’re looking to put $200 extra a week* toward your loan and have a few hours to spare every weekend, Uber is an option you may want to consider.

*Actual earned wages will vary based on where you live, how much you drive and other factors.

How to finance an Uber car

While Uber ended its financing program in 2017, there are still ways to get a car to drive for Uber. New and existing drivers can rent a car through one of Uber’s partners. Or else you could consider buying a new or new-to-you car to use for Uber.

Compare car loan options

Name Product Loan Amount Interest Rate Loan Term Min. Credit Score Requirements Table description
CarsFast Car Loans
$500 - $75,000
4.90% - 29.90%
12 - 96 months
Min. income of $2,000 /month, 3+ months employed
Get a new or used vehicle delivered to your door.
Browse thousands of vehicles from dealers across Canada and get matched with financing that meets your needs.
Loans Canada Car Loans
$500 - $35,000
0% - 29.99%
3 - 96 months
Min. income of $1,800 /month, 3+ months employed
Compare rates from multiple lenders.
Complete a single application to get quotes from different lenders. Bad credit, CERB and EI borrowers considered.
$7,500 - $85,000
3.99% - 29.99%
12 - 96 months
Min. income of $1,800 /month, 1+ months employed
Available in Ontario only.
Apply online and get your new vehicle delivered to your door anywhere in Ontario free of charge. All credit scores considered.
Coast Capital Car Loan
$10,000 - No Max.
18 - 84 months
Able to service debt payment of $300/month
Competitive rates and flexible terms.
Finance new and used vehicles from one of Canada's largest credit unions. No credit union membership required. Available across Canada except SK, QC, NT, NU, YT.
Splash Auto Finance
$10,000 - $50,000
9.90% - 29.90%
24 - 84 months
Min. income of $2,200 /month, 3+ months employed
Apply with any credit score.
Get financing for a new or used car. Auto loans for borrowers with fair credit, bad credit, no credit or bankruptcy.
goPeer Car Loan
$1,000 - $25,000
8.00% - 31.00%
36 - 60 months
Min. income of $40,000 /year
P2P platform with competitive rates.
Canada's first regulated consumer peer-to-peer lending platform that connects creditworthy Canadians looking for a loan with Canadians looking to invest.
Carloans411 Car Loans
$500 - $50,000
1.90% - 19.99%
Up to 72 months
Min. income of $1,600 /month, 3+ months employed
High application approval rate.
Get connected with suitable lenders to finance your next car, van or truck. Check eligibility for this loan through LoanConnect.
Canada Auto Finance
$500 - $45,000
4.90% - 29.95%
3 - 96 months
Min. income of $1,500 /month, 3+ months employed
Get financing from partnered local lenders.
Financing for a new or used car is available for borrowers with bad credit, no credit, CERB, EI or bankruptcy.
LoanConnect Car Loans
$500 - $50,000
9.90% - 46.96%
3 - 120 months
No min. income requirement
Pre-approval in as little as 60 seconds.
Get access to 25+ lenders through this brokerage. Get your funds in as little as 24 hours.

Compare up to 4 providers

Representative example: Sergei buys a car to drive for Uber

Sergei lives in Ontario and recently got a side job working as an Uber driver in a fairly affluent region. He wants to get a car for both work and personal use. Knowing his clientele will prefer a luxury vehicle, Sergei decides to buy a 2020 BMW 330I XDRIVE Sedan for $53,000.00 from a dealership. After putting a 15% down payment of $7,950.00 on the car, he heads to his local bank where he applies for an auto loan to cover the remaining cost.

Because Sergei has a solid credit history, he is approved for loan to cover the outstanding amount plus 13% HST on the purchase price. Along with the cost of his loan, he also pays approximately $180.00 to register his vehicle with the province of Ontario – this includes the cost of license plates, a sticker and a vehicle permit.

Cost of new car$45,050.00 ($53,000.00 less $7,950.00 down payment)
Loan typeAuto loan (term loan)
Loan amount$51,940.00
Interest rate (APR)5.90%
Loan term7 years
Additional feesOrigination fee of 3.00% ($1,527.20)
Payment $756.28 monthly or $348.68 biweekly
Total loan cost$63,527.52 with monthly payments or $63,459.76 with biweekly payments

Had Sergei chosen to rent a car through one of Uber’s drivesharing partner companies instead, he could’ve ended up paying around $5-$10 per hour (plus tax) to rent the same type of vehicle. Assuming a rental cost of $6.50/hour and a 15-hour work week, this would’ve cost just over $5,000/year plus tax.

Bear in mind, though, that this would’ve only been the cost of renting a vehicle for Sergei to drive for Uber. He still would have had to find (and pay for) another means of transportation to use when not driving for Uber.

*The information in this example, including rates, fees and terms, is provided as a representative transaction. The actual cost of the product may vary depending on the retailer, the product specs and other factors.

Bottom line

While Uber worked for me, it might not be everybody’s choice. If you’re not quite ready to sign up for Uber but want to make extra money to pay off your car loan, consider other side gigs. You might also be able to refinance your car loan to get a better deal and potentially pay it off faster.

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