Are you a temporary resident in Canada and in need of a car? The good news is that some lenders are willing to offer car loans for temporary residents \u2013 but you may be subject to more stringent eligibility requirements than other borrowers.<\/p>
Yes, car loans for temporary residents are essentially the same as any other car loan, except that fewer lenders offer them and you may need to meet additional eligibility requirements, including how long you\u2019ve been in Canada, how long you intend to stay and your employment status.<\/p>
Be sure to check with your lender to find out exactly what status and documents you must have in order to apply for a loan. Keep these 5 factors in mind when looking for a car loan with a work permit.<\/p>
Some lenders will only extend credit to nonresidents holding certain types of visas. Borrowers with student visas or permanent resident status will likely have a greater chance of success than someone on a provisional or seasonal work visa. You\u2019re odds of car loan approval are even better if you have an employer-sponsored visa.<\/p>
While requirements may vary between lenders, some lenders may limit auto financing to temporary residents with one of the following Visas:<\/p>
Some lenders may rule you out if you\u2019re on a short-term temporary visa such as a seasonal work visa so your best bet is to apply if you have a work permit that extends for at least a year or two. Your loan will typically only extend for as long as your work permit and passport are valid.<\/p>
Ideally, you\u2019ll have lived in Canada for at least three months, been gainfully employed and earning a steady income. If your passport is about to expire, or your work visa doesn\u2019t extend beyond half a year, you may have trouble getting approved. You should use your work permit and employment status to show lenders you are here to stay.<\/p>
As a nonresident, you likely have little or no credit history in Canada. Since lenders won\u2019t consider your overseas credit history, they may place more emphasis on your down payment, income and employment status to help determine your ability to repay a loan.<\/p>
Many visas have strict limitations on the number of jobs you can hold or hours you can work in a week. While it\u2019s important to maximize your income before applying for a car loan, lenders likely won\u2019t extend you credit if you\u2019ve breached the terms of your visa.<\/p>
Most car loan providers offer terms from 1-5 years. However, you likely won\u2019t be offered a loan term that extends more than 3 months before your visa expires. Most lenders only consider your current visa and won\u2019t rely on pending visa applications or extensions \u2014 no matter how likely you are to be approved.<\/p>
Applying for a car loan through a broker may be your best chance, as a broker can match you with a lender willing to offer loans to temporary residents. As with all car loans, eligibility criteria vary by lender and may include minimum income and credit requirements<\/a>.<\/p>