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Car buying strategies for new Canadians

Car buying strategies for new Canadians

Immigrants who set foot on Canadian soil for the first time will be amazed by the sheer size of the country landmass wise. We are the second-largest country in the world, but our population is pretty low at under 40 million, we are spread thinly across the country and primarily along the border with the USA.

To live a normal life here in Canada, you really need a car unless you are living in an area like the GTA, where the TTC has public transit options, but for most of us, public transportation is a pipe dream at best.

How car buying works in Canada

There is roughly one car on the road for each Canadian, so we know how to buy cars; paying for them is another matter. Just about everyone in Canada you meet has to arrange financing to purchase a car, whether they are buying new or used.

To secure auto financing in Canada, you need a stable income and credit score that meets the underwriting guidelines established by creditors.

Some new Canadians may come from a culture where debt is something to be avoided, but most people cannot afford to pay for a new or used car with a lump sum payment.

Credit scores and car loan fundamentals

You can access your credit score by signing up (it’s free, don’t worry) with TransUnion and Equifax. These credit reporting agencies have credit files on every adult in Canada, including you. If you have a cell phone, you have a credit profile.

Your credit score can range from the 400s to 800s, depending on which scoring model is being used. To qualify for a car loan or most types of credit, your score needs to be in the 600s. Lenders use your credit score to determine how risky the loan is; the riskier you are, the higher the interest rate you are charged.

You can do some basic things to keep your credit score high

  • Don’t try to open too many new credit accounts in a short amount of time. These “hard inquiries” will knock your credit score down and make it look like you are having financial problems.
  • Try to reduce the amount of debt you are carrying on a monthly basis.
  • Always make your payments on time.

These three simple steps are going to help keep your credit score high, so you can access the most competitive interest rates when applying for a car loan or anything else.

What type of vehicle are you interested in buying?

There are many great choices available in Canada; whether you are buying a hybrid or EV, you have options like Kia, Ford, Dodge, and Jeep, to name a few.

To get a really good deal on a new car, you will need to work with a car dealership in your community, one that has a reputation of providing top-notch customer service.

These dealerships not only have cars for you to buy, but they can also help get you approved for a car loan, no matter your credit score, so call or visit your local dealership today.

We will use all our skill and experience to deliver the lowest possible Canadian auto loan rates, guaranteed. Contact Car Nation Canada Direct to learn how we can help.

Categories: Auto Loan

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