Moving to Canada offers many exciting opportunities, but with them come a few challenges. For many individuals, owning a new car becomes essential to exploring the country and accomplishing daily tasks smoothly. However, car buying is costly and may require an auto loan application. If you’re an immigrant who needs to own a vehicle in the country, various intricacies are involved in getting financial assistance.
Understanding Loan Eligibility Requirements
When obtaining financial assistance in Canada, whether you’re a permanent or temporary resident, there are various conditions you must meet. Lenders consider multiple factors before giving out financial aid.
The financial system in Canada assesses the creditworthiness of individuals using credit scores. Many companies lend money for car purchases through a minimum score requirement, but the standard ranges from 630 to 650. A common challenge that newcomers face is establishing a Canadian credit history.
As a non-resident, you may have no credit record in the country. Financial institutions place no consideration on your overseas credit history; therefore, they verify your employment status to assess your loan repayment capabilities. If you meet the requirements, you can get the necessary credit approval.
Financing Options for Newcomers
Despite the challenges faced by new immigrants when applying for an auto loan, there are still ways to get assistance. It’s essential to assess the options and pick the one that suits your situation. Some common avenues include:
Dealership Financing
Lenders often partner with auto sellers, making them a convenient choice for newcomers. Even with a limited credit history, you can secure a loan for your vehicle purchase at the point of sale. However, you must review the interest rates and other terms before finalizing the deal.
Financial Institutions
Credit unions, banks, and other institutions provide motor vehicle financing options. These entities have specialized programs to cater to visitors needing vehicle purchase loans. The programs focus on assessing the applicant’s employment stability and income to gauge their loan repayment capacity.
Lines of Credit
As a traditional vehicle loan alternative, newcomers can explore personal loan options with different requirements. Following the agreement terms, you can use these loans to buy your vehicle. However, you must carefully consider the repayment terms and the potential impact of this option on your credit score before settling for it.
When settling for a loan, you must understand the loan terms, including amortization and monthly payments. Consider whether you’d like a new or used car to ensure the cost fits your budget. Remember to factor in the insurance costs when budgeting for your loan.
Get Your Car Loan Today
At FFUN Financial, we believe in helping people acquire their dream cars effortlessly. If you have left your home country and are experiencing car purchase challenges as a foreign worker in Canada, we have you covered. Contact us today for professional services.
