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How To Get A Car If I’m New To Canada

04/20/2019 @ 1:35 AM

First of all, congratulations on your move to the land of true patriot love!

Along with Canada’s beautiful and vast land comes opportunity and security. Starting from scratch can seem overwhelming, but if you clearly outline tasks and do a bit of research, you’ll settle down and get into the groove of things in no time! We’ve identified some popular questions in relation to getting a new ride in Canada, as well as some tips to help you get started. Whether you’ve got zero credit, high credit, or are seeking a bad credit car loan in Scarborough, we’ll help you navigate through the process.

A new car delivered from Scarborough bad credit car loans

Can I get a Car with Zero Credit?

If you’re looking for a car with zero credit and zero credit history, it’s important to understand that every credit lender operates a little bit differently.

It is possible to get a car with zero credit, but it’s important to work with the right car loan company that will both prioritize your financial and personal needs while finding you the best deal in Ontario.

If you are looking to take a car loan approach with zero credit, you can actually use your car loan to build your credit in a number of ways! Why not multitask by both getting approved for a car loan, driving your new ride, and building credit while you’re at it?

Building Credit

No matter what level of credit you’re at, it’s always good practice to implement financial rules to either boost or maintain your credit score! Before you can actually begin to build credit, your first step should be to open a Canadian bank account. We recommend applying for a credit card that suits your personal and financial needs. Try to select a credit card on which you can get the best bang for your buck! If you spend a lot on groceries and gas, you may want to apply with a credit card company that has a great cash back rate. If you travel quite a bit, maybe look into flying rewards! Remember, it’s always great to build credit while maximizing every cent you spend!

Before we get into different tips and tricks to maintain and build healthy credit, you should understand how the credit system works in Canada!

Credit scores in Canada are three-digit numbers, and generally range from 300-850 with five ranking categories:

1. Poor: 300-559
2. Fair: 560-659
3. Good: 660-724
4. Very Good: 725-759
5. Excellent: 760+

Obviously, everyone’s ideal credit status should be “excellent”, as having a high credit score limits barriers to credit approvals. However, achieving an excellent credit score can be difficult and each credit score is unique to a person’s finances and spending habits. If someone has a credit score below the excellent range, just know that you’re not alone! Building and repairing credit is possible as long as you put in the effort.

We’ve outlined the top four ways you can increase your credit score along with your bad credit car loan in Scarborough:

Make Regular Payments

Making regular payments does seem like an obvious tip, but with so many events, payments, appointments and tasks to keep track of, it can be difficult to remember (especially for someone who just moved to a new country)!

When an individual pays bills regularly, it creates a sense of trust between lenders and borrowers. As a result, lenders will be more likely to approve any of your future requests since you’ve have already proven to be reliable.

Keep in mind, this rule doesn’t just apply to paying your credit card on time but any form of debt, including: utilities, cell phone, rent/mortgage, cable and any other bills you may need to pay. At the end of the day, try your best to pay all of your bills on time or even ahead of time–whatever works for your schedule and needs. We can’t stress this enough as regular payments do play a big role in credit score calculation, so late or missed payments can make a negative dent on your credit health.

Close up image of a car purchased through a bad credit car loan in Scarborough

Maintain a Low Credit Card Balance

Typically, financial advisors always recommend keeping low credit card balances, similar to how many suggest maintaining low debts in general. If your financial situation allows you to, try to keep your credit balance to 25%. So, if you currently have a credit card limit of $5000, your monthly balance should be close to $1250.

The issue in having high card balances is that lenders will view you as an irresponsible spender. For example, if you are spending $1999 monthly and only have a $2000 limit, it doesn’t reflect a good credit spent to credit available ratio–even if you do pay it in full. Furthermore, credit bureaus actually use your credit utilization to determine your score! An individual’s available to used credit ratio accounts for (on average) 30% of your credit score! If you find yourself spending more on your credit card (and are financially healthy enough to pay it off monthly) you should definitely contact your credit provider to simply increase your credit limit.

Increase Your Credit limit

As we just mentioned, credit utilization accounts for a significant portion of your credit score. However, we want to reiterate that increasing your credit limit should not increase your credit spend!

Instead, always work to stick you your budget and strategically and carefully spend within your new limit to prove that you are a responsible credit user. By utilizing credit correctly, it can repair or build credit, moving you from the red and into the green. In the future you may even be able to utilize more of you new credit limit due to the interest savings!

Use Your Credit Card More Often

In 2019, seeing people pay with cash (apart from cash-only establishments of course) is a rare sight, but it’s for good reason!

More and more, people have started to increase their credit utilization so that they can
1. Have a digital record of their spending and
2. Reap the rewards that many credit card companies offer

Increasing your of you credit usage and paying it off regularly shows credit providers that you are able to use credit responsibly. It’s one of the most effective methods in building or repairing credit. Lenders ultimately love to see that you don’t pose a risk to them, so you should do everything in your power to maintain that trust. It’s simply about shifting spending to a place in which you can get more benefits. For example, instead of paying for your lunch at work with a five dollar bill, use your credit card instead and keep the cash for savings.

As we mentioned, a big motivator to increase credit card frequency is that many credit providers offer incentives to choose their product. While you certainly can be strategic and benefit off of credit card promotions, it’s also important to be cautious of why they offer these deals in the first place. Credit card companies only offer incentives to rack up, and make a profit off of interest rates.

We strongly recommend implementing this credit rule of thumb in your financial spending as it’s a great way to build credit and collect rewards at the same time!

Create A Credit Mix With Variety

Similar to maintaining a balanced diet with protein, fruits, vegetables and dairy, credit health operates in the same way. Rather than put all your eggs in one basket with a single credit card, we advise creating a credit mix with a variety of credit forms.

Some lenders, depending on whom you go to, will request to your borrowing set before approving you for a new line of credit. Borrowing sets are essentially a collection of your credit mixes. For example, home loans, credit cards, student loans, credit accounts (that are paid on-time), and bad credit car loans in Scarborough make your finances and credit health look well rounded.

Finding Your Dream Car

Once you understand the importance of building credit and how it can be done, the next step is to get your dream ride! Working with a reliable credit provider that puts you first is crucial to maximize your financial health and build credit. If you’re looking for a bad credit car loan in Scarborough,Scarborough Bad Credit Car Loans Has Got You Covered.

Our dedicated staff members will walk you through each step of the process, from analyzing your credit report, to understanding your financial limits and credit health goals. Once our team has a good grasp on what your priorities are, we’ll work directly with you to find a car that’s best suited to your needs. Here at Scarborough Bad Credit Car Loans, our team will work tirelessly to make sure you get the best possible interest rates on your car loan. We negotiate with Canada’s top banks so that you don’t have to, and we won’t stop until we’re both happy. After finalizing the car loan terms with the help of our customer service agents, we’ll get you into your dream ride.

We offer a selection of over 7000 certified used and new cars, so you’ll be sure to find something that you absolutely adore. We only offer certified used cars as we want the car process to be as stress-free as possible for our consumers. Owning a certified used or new car ensures that you won’t have to deal with the headaches of broken parts as soon as you pick it up.

To demonstrate our commitment to you, we’ll even deliver your brand new car straight to your door– just tell us where and when!

At Scarborough bad credit car loans, we understand new citizens’ urgency of getting a car, and that’s why we strive to make the process as simple and quick as possible. If you’d like to look into getting a car with the best car loan providers in Ontario, contact us today!