Car loans for non-residents working in Australia

23 Mar 2017

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Most car loan lenders require their customers to be permanent residents or citizens of Australia in order to lend funds. This can be quite difficult for people on extended working or student visas who require a vehicle. The good news is, there are some lenders with a fairer approach if you can fit their normal lending criteria, such as their affordability calculations.

In certain situations, a customer can obtain a car loan on a work visa, the typical conditions are that the work visa must be valid for longer than the duration of the loan applied for and the visa holder must not be in breach of their visa by working multiple jobs or extended hours.

Unfortunately the lender will only go off what the current visa states and will not consider any pending visa decision, even if the applicant believes the outcome of the visa application will be granted regardless.

One problem many applicants face is that their visa duration may only allow them a short term loan of 2-3 years which will increase the repayment costs dramatically and could prevent the applicant from passing the affordability tests that each lender has.

Temporary or provisional visas can also 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. This could result in the couple not being able to obtain the loan they were after, or having to reduce the loan size and their new car budget.

Each application will be considered on a case by case basis and careful preparation should be undertaken prior to applying anywhere, as the more times the applicant applies and places an enquiry on their credit file, the harder it will be to get approved for a loan. Good professional advice should be obtained prior to applying, especially if one or both of the applicants is a non-resident.

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