Vehicle loans for visa holders

October 2nd, 2024

Moving to a new country is an exciting adventure, but it can also come with its challenges, especially when it comes to securing major purchases like a car. If you’re a visa holder in Australia, getting a vehicle can be crucial for commuting, exploring, and settling into your new life. However, vehicle finance for visa holders can seem like a daunting process. The good news is that it’s entirely possible to secure a loan to buy a car even if you don’t yet have permanent residency.

In this blog post, we’ll break down everything you need to know about vehicle finance for visa holders in Australia—from the types of loans available, the eligibility criteria, and some tips to help make the process smoother.

Types of Vehicle Finance for Visa Holders

Several types of vehicle finance options are available for visa holders, and the one that suits you will depend on your individual circumstances.

  1. Secured Car Loans A secured car loan is the most common option for purchasing a vehicle. With this type of loan, the car itself serves as collateral, meaning the lender has a claim to the vehicle if the loan isn’t repaid. As a visa holder, providing security to the lender can make your application more attractive.
  2. Unsecured Personal Loans If you are unable to secure the loan with the vehicle or other assets, an unsecured loan may be an option. For visa holders, obtaining this type of loan may be more difficult unless you have strong financial standing or a longer visa duration.

Eligibility Criteria

The eligibility requirements for vehicle finance in Australia may differ slightly for visa holders compared to citizens and permanent residents. Lenders will typically assess the following factors:

  1. Visa Type Some lenders have restrictions on the types of visas they accept for finance applications. Generally, holders of long-term visas, such as skilled worker visas (e.g., Subclass 457 or 482), are more likely to be approved. Other common visa types eligible for vehicle finance at EFT Capital include student visas, partner visas, and bridging visas. Ensure your visa has sufficient time remaining, as most lenders prefer applicants with a visa valid for at least 12 months beyond the loan term.
  2. Visa Duration The remaining time on your visa can significantly impact your approval chances. The longer your visa, the more favourable your application. Lenders usually prefer applicants whose visa length covers the loan term.
  3. Employment Status Your employment status and income stability are key factors in the approval process. EFT Capital favour applicants with full-time employment and a steady income. If you’re on a temporary visa but have a secure job, you’ll have a stronger case for approval.
  4. Credit History A good credit history will always work in your favour. For visa holders, Australian credit history may be limited, so having a positive financial record from your home country or providing evidence of responsible financial management can improve your chances.
  5. Deposit A deposit may be required to secure the loan. If you can provide a larger deposit, it demonstrates financial stability and reduces the loan amount, making it easier for lenders to approve your application. At EFT Capital it is not a necessity to have a deposit. We will assess your application and advice.

Steps to Apply for Vehicle Finance

  1. Check Your Visa Conditions Before applying for any loan, ensure your visa validity is at least 12 months or more.
  2. Prepare Your Documents You’ll need to provide certain documents for the application process, including:
    • Passport and visa information
    • Proof of employment (such as a contract or recent payslips)
    • Proof of income
    • Proof of residency (rental agreements or utility bills)
    • Bank statements to show financial stability
  3. Get Pre-Approval Getting pre-approval for vehicle finance gives you an idea of how much you can borrow and strengthens your negotiating position when you’re ready to purchase a car. Contact us at application@eftcapital.com.au for a pre-approval.
  4. Choose the Right Vehicle Once you have finance approval, choose a car that fits your budget. Remember to factor in additional costs like registration, insurance, and ongoing maintenance.
  5. Complete the Application After selecting your car, finalize your application at www.eftcapital.com.au. Upon approval, the funds will be transferred to the car dealer or seller.

Tips for Visa Holders Seeking Vehicle Finance

  1. Build a Strong Application Providing comprehensive documentation, such as proof of employment and financial stability, can strengthen your application. If possible, offer a substantial deposit, which will reduce the lender’s risk and increase your approval chances.
  2. Choose a Lender Experienced with Visa Holders At EFT Capital we are more accustomed to working with visa holders and may offer more favourable terms.
  3. Consider Short-Term Loans Opting for a shorter loan term that aligns with the duration of your visa may make lenders more willing to approve your application. You can refinance the loan later if you extend your visa or gain permanent residency.
  4. Manage Your Credit If you plan on staying in Australia long-term, start building a strong credit history as soon as possible. Paying bills on time, managing credit cards responsibly, and maintaining a stable financial record will improve your chances of approval for future loans.

Final Thoughts

While the process of securing vehicle finance as a visa holder in Australia can be slightly more complex than for citizens and permanent residents, it is certainly achievable. By understanding the available loan types, preparing a strong application, and EFT Capital that cater to visa holders, you can drive away in your own vehicle without unnecessary stress.

If you’re unsure where to start, contact us at www.eftcapital.com.au or on application@eftcapital.com.au for your non-resident loan.