Car Loans for New Credit Applicants
Whether you are a newcomer to Canada or a student that has never had a credit card or loan, you have new credit. People often think that new credit is easier to obtain an approval than people with bad credit, that in not necessarily the case. When dealing with fresh credit, or looking at an auto loan for new immigrants, lenders often categorize the applicant at a high-risk level since there is no history to base their decision on. This is not to say that an approval is out of reach.
Things you will need: You will need to be employed as the bank will ask for income verification. For newcomers in Canada, you will also need proof of Visa and the lender would want to make sure you are either here for an extended period of time or here to stay. It is not always necessary for a new credit applicant to provide a down payment as long as the vehicle that you select complies with the bank’s requirements. If you are unemployed or are having some difficulty with obtaining an approval, you can always seek help from a co-signer with qualified credit.
Things to expect: Since a new credit applicant is usually deemed riskier to lenders, expect the interest to be a bit higher. Interest is determined based primarily on your credit and other factors such as the unit you select. Focus on payment affordability as interest set by the lender. Another thing you can expect is an easier approval on your next car loan given that you keep your first car loan in good standing. As long as you make payments every time, and on time, you can expect your credit to be in prime level.
Starting to build your personal credit is a big step. In North America, credit is necessary for any big purchase. It takes years to build good standing and as much as one mistake to scar it so allow one of our knowledgeable finance specialists at Autorama, put you on the right path. Call 1(866) 979-2947 or fill out our no obligation finance application and allow us to secure your very first car loan today!