As a student, it’s essential to be ready to start a new phase in life after studies. That includes having a car to help you run your regular activities with ease. Whether or not you’re an international student in Canada, owning a first car will help you meet your needs and provide more convenience while travelling in and out of school. There are various auto financing options that you can rely on. Here is a quick guide on car financing options for Canadian and international students.
Qualifying for car financing for Canadian Students
When applying for a student car loan, there are various things to consider to increase the chances of optimal results. Getting a car loan from a financial institution means you have to meet some eligibility criteria such as good credit history, social insurance number, driver’s license, and any other documentation.
Once you’ve all the documents, you can submit your loan application. Student car loans don’t always have the same loan term and interest rates. That’s why you have to find a reliable auto financing option. Here are car financing options to choose from and auto loan application tips.
Car loan options for Canadian Students
First, you need to have a job. Having proof of income shows you’re capable of making auto-finance payments. However, there is still an option to help with financing if you have no job. You can get a co-signer or a decent down payment.
The second option is considering banks, lenders, and dealerships. These financing options are so common in Canada, and it works for anyone in need of a new car. Students’ credit history is minimal and at a slightly higher interest rate. Funding by these options differs.
Banks and lenders offer car financing to those with good credit scores, bank statements, and more. With a bad credit score, getting car financing and personal loan from such options is difficult.
For Canadian students, car dealerships are the best optionas they offer quality vehicles at a lower interest rate and lower cost. To increase the chances of getting car financing from dealerships, they will request your recommendation letter and schooling results/transcripts as proof of the course you’re taking.
In addition, you’ll need to agree on a repayment plan, such as making an upfront payment, monthly payments, or credit card payments, before pre-approval. Also, the loan terms vary depending on the vehicle type and price.
There is also a financing option for international students if they are not permanent residents. Usually, international student car loans range between $15,000 to $20,000, making used cars a good alternative for the best value.
When applying for an auto loan with a social insurance number, you must prove that you will be in Canada for that extended period. You’ll also have to provide details of your source of income that will cover the car payments. Additionally, some lenders offer international student car loan programs, so always research first.
If you’re a Canadian student planning to get a new auto car, always find a financing option suitable for your financial situation. For more car financing options and tips, speak to DriveNation.