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Tips for new Canadians wanting to buy a car

Tips for new Canadians wanting to buy a car

Canada is made up of people from all walks of life and if you are a newly minted Canadian, you probably want to realize the dream of buying a car.

Our Dunnville auto loans team has prepared some tips that will help make your car buying experience much more pleasant than it could be.

Requirements to get a car loan in Dunnville

Each Dunnville car loan provider has their own specific criteria of what they are looking for when deciding on whether to approve a car loan. These requirements generally apply to all of the lenders you would come across.

Lenders are going to ask you for your date of birth and Social Insurance Number (SIN). You are not obligated to give out your SIN and should only do so with well-established companies that you can meet with in person.

Lenders take your personal information and perform a credit check (with your permission).

There are two major credit reporting agencies in Canada that keep records on every Canadian that uses credit facilities. These firms are Equifax and TransUnion.

What the credit reporting agencies do is provide lenders with details on your financial dealings and also a credit score which ranges from 300-800. Higher credit scores indicate you are more likely to pay your debts as agreed compared to someone with a lower credit score.

In Canada it is illegal to deny someone services including Dunnville car loans based on your race, religion, or sexual orientation.

But lenders can refuse to approve a loan if your credit score or income does not meet industry standards.

To qualify for the best interest rates on a car loan, your credit score will need to be over 680. You can pay a subscription to find out what your credit score is, but save some money and use apps like Credit Karma, that provides your credit score in real time.

Income verification process

Along with checking your credit score, the lender is going to look at your income. The lender has to calculate what is the maximum amount of car loan, if any you can afford.

Most lenders use the debt-to-income ratio of 30%-40% as the maximum threshold they will approve. If you are earning $10,000 per month, then your maximum debt load including any new car loans is $3,000-$4,000 depending on what level the lender has selected.

Locating the lenders with the best financing terms

You may use the Internet to do research and do shopping. While the Internet is a great tool for online shopping, you should go to a local car dealership to explore all of your financing options.

The dealership has access to all of the lenders across Canada and is able to get you the most competitive rates. If you are having issues with getting credit or your credit score is not high enough, the dealership will show you how to address your credit issues and come out on top.

A great benefit of going to a local dealership is you can test drive all of the cars they have in their inventory until you find the one you like the most.

Everyone in Canada needs a car and now that you call Canada home, you should head over to your local dealership for a test drive.

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

Categories: Auto Loan

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