Car Loans For Newcomers to Canada: The Ultimate Guide
Car Loans For Newcomers to Canada: The Ultimate Guide
Posted on September 1, 2022
Canada remains a popular place to begin a new life. Friendlier and nicer than the US and more welcoming too. We have an excellent way of life, stable society and lots of space. Lots and lots of space. Which means youāll need a car when you arrive.
We asked our Halton Hills auto loans team to outline how to get a car loan as a newcomer to Canada. Itās actually easier than you might think.
Car Loans for Newcomers to Canada
The first thing youāll realize when you arrive in Canada is that youāll need a car to get anywhere. As soon as you leave the city, youāll need to use a car to get anywhere not on a flight route or train line.
The second thing youāll realize is that the credit score you spent so long building at home, is no use to you here. Credit histories donāt travel.
Even though the credit bureaus are international, credit histories are unique to the country they were created in.
That means starting over.
Before you apply for an auto loan, you need to take care of some administration.
Youāll need:
A Canadian driverās licence ā This is a primary form of ID in Canada and youāll need one to be able to buy and insure a car. If you buy from a dealership, you wonāt be able to drive away without insurance and youāll need a licence to get insurance.
Canadian Citizenship card ā Your Canadian Citizenship card is also important. Once you have this card, the whole world of finance opens up. While you can access some credit without one, you will be limited in your options until you get one.
Applying for the Halton Hills auto loan
Once you have those two documents, you can begin preparing for your auto loan.
That means:
Starting to build your credit history in Canada ā Set up a bank account and get a credit card as soon as you can. Use a secured card if you cannot get a standard one. Ask your landlord to mark payments on your credit file. Use a phone company that does the same, and request utility payments are also marked.
All will make a minor, but important, mark on your credit report.
Get a down payment together ā Down payments are essential for loans in Canada like they were in your old country. The more you can put down in these early days, the better chance you have of qualifying for the loan.
If you donāt want to pay cash for your first car here, use whatever you can as a down payment. Youāll stand a much higher chance of success if you risk your own money as well as a lenderās.
Work with an auto loan specialist ā Some national banks have special car loans for newcomers to Canada. We also work with lenders willing to lend to anyone, with any credit history.
When youāre ready for a car lease or loan, get in touch with the Halton Hills auto loan experts at Northway Ford for great deals on auto finance.
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