Trying to finance a car on a visa in Australia? Different visas offer varying levels of eligibility for car finance. This article provides straightforward guidance on “what visa can I get car finance on” in Australia, what expectations you should have as a borrower, and essential tips to navigate the process and increase your chances of approval without delving into extensive detail.
Understanding Car Finance for Visa Holders
For temporary visa holders in Australia, understanding car finance can be daunting. Often times, permanent residents receive more lenient lending criteria when it comes to loan terms and amounts compared to those who are temporarily residing here. Our aim in this blog is to make the process of acquiring a vehicle loan as a Temporary Resident a little more straightforward. With awareness surrounding suitable lenders & their specific requirements for eligibility, one can gain a little more insight into lending criteria without too much trouble.
Visas that provide pathways to permanent residency are generally looked upon more favourably, while working holiday or bridging visas may not. When it comes to those holding bridging visa, there may be extra considerations that must be taken into account due to its short-term nature like evidence of income over an extended period of time as well as stability within employment. There are also other restrictions such as not exceeding certain working hours under particular visa regulations, etc. In order meet these qualifications, lenders often require at least 1 year on any given visa type held by applicants prior to commencing vehicle loan applications provided they have fulfilled all necessary conditions thoroughly laid out by potential providers before hand. Considering many car loan terms are for three years or longer you’ll want to make sure your visa is valid for longer than this.
Types of Visas and Car Finance Eligibility
The type of visa you possess can affect your eligibility for car finance significantly. For instance, Temporary Work (Skilled) Visa holders (Subclass 482), while potentially able to acquire a loan in Australia, may be viewed as higher risks by lenders and therefore income level and occupation will often be evaluated. International students holding Student Visas (Subclass 500) have the chance at getting approved for such loans with Australian financiers if they meet the income criteria set out by them, while also having an adequate duration remaining on their visas.
Lenders' Perspective on Visa Holders
When it comes to car finance, lenders tend to be risk-averse when considering visa holders. Temporary residents are often seen as a higher credit risk than permanent residents due to their expiration of work permits and the likelihood that they could suddenly depart from the country before the loan repayment is complete. On top of this, banks worry about situations where temporary workers violate their visas with immediate effect, causing them to have no option but to leave straight away.
All types of visas aren’t treated equally in regards to getting finance approval for cars. Loans typically favour those who hold student or working visas, which can often lead to more secure residency at some point down the line compared to provisional or bridging visas without any end date. Temporary or provisional visas can sometimes pose a problem with some lenders, as they are viewed in a similar light to a bridging visa where there is still a formal grant pending. This rule can also present challenges to families where one partner is a non-resident, as most financiers will not be able to use the non-resident spouse’s income in their affordability calculations.
Popular Visas and Car Finance Options
By now, we have evaluated the car loan market from both sides of the equation – visa holders and lenders. To gain a more comprehensive grasp on what kind of car finance is available to you, it’s important to look at common visas in Australia as well as their respective financing solutions. This knowledge should assist with finding an appropriate vehicle loan for any situation.
It doesn’t matter whether you are a skilled worker or recent graduate, there will be some type of car finance option catered specifically for you! Let’s take a closer look at various Aussie visas that come equipped with different kinds of loan options, which may apply directly to your circumstances.
Temporary Work (Skilled) Visa (Subclass 482)
Lenders in Australia, for people on Temporary Work (Skilled) Visas (Subclass 482), may be able to provide them with a car loan. Income, occupation and credit background are taken into account as well as other attributes of the visa such as type, duration and validity by these lenders. Note: Usually loans must end at least 3 months prior to when the visa expires, which can present difficulties if there is less than one year left on it. Depending on your income and other factors, repaying the car loan in just 2 or 3 years could make the loan unaffordable. Even if you believe your visa will be extended after the initial period, the lender will only take into consideration the current visa status as approved by the Department of Immigration. Lenders won’t take into consideration any visa extensions that are awaiting approval. Thankfully, some specialised organisations have managed to develop finance offers including both three years and nine month terms, however this means your repayments may be higher than loans with standard terms (five years is usually the standard).
Student Visa (Subclass 500)
It is possible to obtain car finance in Australia while studying on a Student Visa (subclass 500). Some lenders may accept applicants with as little as 1 month of employment and have specific income criteria. Young students might be limited regarding the maximum loan amount they can borrow. The duration of this type of loan must finish at least three months before their visa expires. Despite being complex due to its eligibility requirements, if you meet them all then it could mean driving your dream car through beautiful Australia!
Temporary Graduate Visa (Subclass 485)
If you’ve just finished studying in Australia and have a Temporary Graduate Visa (Subclass 485), then don’t worry, there is still the possibility of applying for car finance. The lenders judge your capacity to repay the loan similarly as with other temporary residents, though how long you have remaining on your visa plays an important part in this decision-making process. It usually works out that if someone has less than one year left on their visa period, they may not qualify for taking out a car loan since lenders create repayment plans based on those specific time frames.
Factors Affecting Car Finance Approval for Visa Holders
When applying for a car loan, it is essential to understand how certain elements can have an impact on the approval process. As someone holding a visa, they must take into account factors such as their credit history in Australia and if there’s stability of income and employment along with the duration of one’s visa compared to the term length of their loan.
With knowledge about these issues clarified beforehand, you will be able to enhance your chances at attaining financing for your desired vehicle so you won’t miss out on driving away your dream car!
Credit History in Australia
For temporary residents who want to acquire car finance in Australia, building a strong credit record is very important. Banks and other loan providers here tend to be apprehensive when it comes to loaning out funds without assessing the existing local credit history. Sometimes overlooking any that may have been established overseas. To attain an impressive credit rating, try keeping your card balances low with higher limits, and always pay bills on time for 3-6 months prior to your loan application. This will help you build reliable financial credibility which lenders can use as assurance of repayment capacity before they give loans towards your new vehicle.
Employment and Income Stability
When assessing car loan applications, lenders prioritise reliable employment and consistent earnings. Having a secure source of income as well as cash deposits in an Australian bank can boost the likelihood of getting approval for a vehicle loan.
For visa holders with part-time work, seeking to acquire auto financing might seem difficult, it is however still possible. Although creditors could be wary when dealing with short-term residents, it is recommended that they look into their options and communicate directly with moneylenders about what’s feasible regarding obtaining the loan for purchasing a car.
Visa Duration and Loan Term Alignment
Securing a car loan as a visa holder is dependent upon the alignment of your visa expiry date and the length of time for repayment. Most lenders prefer that temporary residents finish paying off their loans at least three months prior to when their visas expire, thus diminishing any associated risks they may take on through financing an automobile.
For example, those with 485 Visas need it to remain valid throughout the loan term, until everything borrowed is re-paid. While all other types should ensure it ends before expiration by several months, otherwise pre-approval won’t be granted - especially if less than one year remains on that particular visas lifespan.
Car Finance Options for Visa Holders
When considering your options for car finance as a visa holder, it is important to understand the various loan and interest rate possibilities. Secured or unsecured loans can play an essential role in achieving approval, while also assessing whether fixed versus variable rates are right for your needs.
Familiarity with these factors will make sure that your journey towards obtaining automotive financing is as straightforward and cost-efficient as possible.
Specialised Lenders
If you are a visa holder looking to purchase a car, the loan process can be daunting. Specialised lenders have tailored their services for non-residents and temporary visa holders who struggle with getting financing in general due to increased risks. This might mean higher interest rates on loans, but there’s still hope if certain measures are taken before applying.
Cash Direct is a specialist in lending to temporary residents, such as new working migrants, international students or those on family visas. They will need to ensure you have a valid visa, at least 20 hours per week employment, and are maintaining a good budget that can afford the new loan repayments. They will also typically require a reference and employment verification.
If you're not a permanent Australian resident, you may still be eligible to apply for an ANZ personal loan. You will be required to meet specific visa and income verification requirements. Valid visas include a range of working visas and business visas. Working holiday visas aren’t accepted.
Many working and student visa types are also accepted at Commonwealth Bank, including the 482. Working holiday and bridging type visas are not. Visa must be valid for a minimum one month from the end of the loan term. A full list of unaccepted visas is available on the CommBank site.
At NAB, Many visa types are accepted. However, the following visa categories are not acceptable: Visitor visa (exception, a Special Category visa - NZ Citizen is acceptable), Working Holiday, Student, Exchange/gap year, Transit/short stay/seasonal and Bridging.
Westpac is another option for visa holders looking to secure a car loan. Westpac accepts many visas, particularly skilled work and business visas, and their partners.
You may also be able to get a loan through Beyond Bank. Eligibility is determined on a case-by-case basis based on the type and validity of the visa, though personal loans are not available if you are on a student visa. Similarly, some non-bank lenders like Money3 may accept applications from temporary visa holders, subject to assessment.
Secured vs Unsecured Car Loans
When looking into car finance, it’s essential to be aware of the difference between secured and unsecured loans. A secured loan requires using a newly bought car as collateral, with lower interest rates for lenders providing greater assurance. Usually you can pay the entire cost of your vehicle without having any down payment, resulting in reduced monthly repayments. On contrast, an unsecured car loan does not need security, which often leads to higher-than-normal interest because these pose more risk on the banks’ part – though obtaining one may prove challenging.
Fixed vs Variable Interest Rates
When considering car finance options, visa holders should take into account the type of interest rate available. Temporary residents often face higher interest rates compared to citizens or permanent residents. This is especially true for unsecured car loans or if your credit rating is not strong. Lenders perceive temporary residents as higher-risk borrowers due to the uncertainty surrounding their long-term stay and income potential in the country. Fixed interest rates offer stable monthly repayments over the duration of a loan and provide financial security for them. Variable loans on the other hand are flexible, but may involve fluctuating payments if interest rises. It is essential to carefully evaluate these two alternatives in order to determine what suits your finances best. Car loans can be tailored depending on individual needs so that visa holders have an opportunity to find one that works well with their current economic conditions.
Tips to Improve Car Finance Approval Chances
For visa holders, getting approved for car finance can seem difficult. If you have a good credit history and consistent employment/income levels in Australia then you are likely to increase your chances of receiving the loan that is required. By presenting an application which shows dedication and care, it will bolster these efforts even more. It’s important to remember that obtaining car finance approval isn’t always straightforward, but with patience and knowledge it may be possible!
Building a Strong Credit History
As a visa holder aiming to get car finance in Australia, it is important that you take steps towards building up your credit history. In order to help create a reliable score over time, it is important to manage and keep track of all the balances on your cards, as well as working with higher limits if possible, and making sure payments are always made timely. It usually takes between 3-6 months for this type of record creation, so getting started sooner rather than later can be beneficial.
Maintaining Stable Employment and Income
Obtaining car finance can be tricky for temporary visa holders, especially if you don’t have a consistent income. With the right preparation and persistence, it is possible to secure a loan that fits your requirements. Lenders are often wary of applicants who exhibit instability by frequently changing jobs. Thus making steady employment and regular earnings critical factors when evaluating applications for car loans. It’s also important to provide all necessary paperwork which will demonstrate your current work status and salary level in order to acquire approval from lenders.
Summary
For visa holders in Australia, getting car finance isn’t impossible. Being familiar with the car financing landscape for visas and which kinds of them offer such options is key to success, as well as recognising factors that can influence approval chances.
At Westside Auto, we specialise in helping people navigate the complexities of car finance. Let us guide you every step of the way to ensure you drive away in your dream used car sooner than you think. Contact us today to start your journey toward car ownership!
Frequently Asked Questions
Can 482 visa holders get car loan?
Visa holders with a 457 or 482 Visa who can provide references and validate their monthly budget may be eligible for a car loan. This type of loan could be secured by these visa holders if they qualify under the appropriate criteria.
Can you get finance on an 820 visa?
It is possible for those on an 820 visa to secure finance provided their Australian or Permanent Resident partner joins them as a co-borrower. Some loan providers may impose income requirements.
What makes you eligible to finance a car?
In Australia, to be eligible for financing a car purchase, you must hold an income and proof of regular earnings. Your assets and liabilities need to be documented to have the capacity demonstrated by providing a budget that proves repayment ability. Lastly, it is compulsory that applicants are aged 18 or above with a valid driving license or learner’s permit.
Can I secure a car loan with a part-time job?
Obtaining a car loan while having only part-time employment may be tough, yet it is doable.
What is the role of specialised lenders in assisting visa holders with obtaining car finance?
The work of specialised lenders is essential in helping non-residents and temporary visa holders gain access to car finance. These firms tailor their services to this population’s particular needs, a role that facilitates the securing of loans from these creditors. This ensures crucial automobile financing opportunities are made available for those with visas.
