Tips for new Canadians wanting to buy their first car

Tips for new Canadians wanting to buy their first car

Posted on July 4, 2022

When immigrants come to Canada for the first time, they will be amazed by how big the country is.

Canada is one of the biggest countries in the world in terms of land area, but it has a population of fewer than 39 million people, who are spread out across the country and mostly along the border with the United States.

In Canada, you really need a car to live a normal life, unless you live in a place like the Toronto, where the TTC offers decent public transportation. For most of us, though, public transportation is, at best a dream.

How to get a car in Canada or Kitchener

About one car for every Canadian is on the road, so we know how to buy cars. (pretty much after getting your license at 16, you have a single-minded focus of buying a car) How to pay for them is a different story.

Almost everyone you meet in Canada who wants to buy a car, whether it's new or used, has to get a loan.

In Canada, you need a stable income and a credit score that meets the general underwriting guidelines set by creditors in order to get auto financing.

Some new Canadians may have grown up in a culture where debt is bad, but most people can't afford to pay for a new or used car all at once.

Credit scores and Kitchener car loans: What you need to know

You can find out your credit score by signing up with TransUnion and Equifax. It's free, so don't worry.

There is a credit report on every adult in Canada, including you, that is kept by these agencies. You have a credit profile if you have a cell phone.

Depending on the scoring model, your credit score can be anywhere from the 400s to the 800s. For most types of credit and car loans, you need a credit score in the 600s.

Lenders use your credit score to figure out how risky it is to give you a loan. The riskier you are, the more you will pay in interest.

There are simple things you can do to keep your credit score high.

• Don't try to open a lot of new credit accounts all at once. Your credit score will go down because of these "hard inquiries," and it will look like you are having money problems.
• Try to cut down on the amount of debt you have every month.
• Pay your bills on time every time

These three easy steps will help you keep your credit score high so you can get the best interest rates on a car loan or anything else you want to buy.

What kind of car are you looking to buy?

Canada has a lot of great options. If you want to buy a hybrid or EV, you can choose from Kia, Ford, Dodge, and Jeep, to name a few.

To get a good deal on a new car, you will need to work with a car dealership in your area known for having great customer service.

You can buy cars at these dealerships, and they can also help you get a Kitchener car loan, no matter what your credit score is. Call or go to your local dealership now.

When you’re ready for a car lease or loan, get in touch with the Kitchener auto loan experts at Northway Ford for great deals on auto finance.