If you’re a newcomer to Canada, welcome! You couldn’t have chosen a nicer place to set up a new life!
You’ll quickly learn that you need a car to get anywhere in this country. We have a superb public transit system but as soon as you’re outside city limits, you’re on your own.
That means car ownership is mandatory for anyone who doesn’t live within metro areas.
Which presents something of a challenge. As a new arrival to Canada, you won’t have a credit history, you will have a minimal credit score and you will find it initially difficult to find a standard car loan.
You could buy a car for cash but not everyone has that kind of money laying around!
Even though credit bureaus work across the western world, your credit history is unique to the country you built it in. That means if you have an excellent credit score in France or Germany, you’ll need to start over in Canada.
It isn’t impossible to find a car loan as a newcomer to Canada though. Dixie Auto Loans specialize in this type of loan and work with a range of lenders willing to work with new immigrants.
There are a range of specialist Paris auto loans designed specifically for newcomers to Canada. Contact us to learn more.
First steps to building credit as a newcomer to Canada
Your first step to building credit once you’re here is to set up a bank account and get a credit card.
Many banks in Canada offer cheque accounts to newcomers, including RBC. If your home bank has an international presence in Canada, they may also be a good bet.
Everything begins with the bank account so that should be your first step.
Credit cards and credit building
Once you have a bank account, you should apply for a credit card. Even if you’re not usually a credit card user, it’s an important tool for building credit.
Some banks will offer credit cards to newcomers with no credit. Otherwise, there are secured credit cards you can use to get started. We recommend using a standard credit card if you can get one, otherwise a secured card will work.
Use it for everyday expenses but make sure to pay it off in full each month to avoid paying interest. Set up automatic payments so you never miss a payment but don’t depend on minimum payments to run a credit card.
Other credit building options
If you’re renting an apartment, see if the landlord or leasing company will add notes for regular payments on your credit report. Some will, some won’t but it’s always worth asking.
Then get a phone contract and set up automatic payments for that. Pay all utilities using your bank account too. These will make a small difference to your credit score but every little counts!
After 18 months or so, you should have a sufficient credit score to access other financial products like personal loans, Paris auto loans and perhaps even mortgages.
For those of you who know that you have a challenging credit situation, please visit Dixie Auto Loans where we have a team of credit specialists ready to help you get approved for a car loan today!