If you are a newcomer who is just getting established in the country, you may find that you need to buy a car. That's because you'll probably find it useful to have access to personal transportation in order to get around.
As a newcomer, it is unlikely that you have a credit history in this country. Luckily, getting an auto loan to buy a car will give you an opportunity to build credit. However, you will need to be approved for financing first. And one of the ways that will make this process easier is to find a qualified co-signer.
What Your Co-Signer Should Know
A co-signer is someone who agrees to share responsibility for a loan with the primary borrower. Because co-signing requires a big commitment, you should ask either a close friend or family member. This individual should also have good credit and a firm understanding of the risks involved.
Anyone who agrees to co-sign should be aware of the following:
- They will be obligated to pay for the loan if the primary borrower defaults.
Even if it seems 100 per cent likely that the borrower will make all of their payments on time, things can happen. So, if having to take over the payments would be a financial burden, this person should probably not co-sign a loan. - Loan contract terms can vary from lender to lender.
A co-signer should never assume anything when it comes to the loan contract they are agreeing to. Therefore, the contract should be read carefully and all co-signer responsibilities should be understood completely. Copies of the contract should be obtained and kept by both the borrower and the person who co-signs. - A co-signer will see an impact on their credit score.
If someone co-signs an auto loan, this loan will show up on their credit report as debt that they are responsible for. So, if they were to apply for a loan after co-signing, they might be denied if the co-signed loan has made their debt load too large.
Agreeing to co-sign a loan is a decision that should not be taken lightly. This means that you should explain the obligations involved before asking someone close to you to be a co-signer.
Getting Approved for an Auto Loan without a Co-Signer
If you don't want to use a co-signer, you can still get approved for an auto loan with no credit. As long as you have a valid driver's licence, a regular, qualifying income and proof of residence, there are lenders that will work with you.
In order to finance a vehicle with no credit and no co-signer, you will probably need to find a special finance lender. These types of lenders work through qualifying dealerships. This means you need to find a dealer with the right lending connections.
No Credit Auto Loan Assistance
Finding the dealership that can give you your best shot at auto loan approval with no credit can be hard. So let Canada Auto Loan do the work for you. We can quickly and easily match you with the right dealer, right in your area.
Our service is free, so you won't be wasting your time or your money. You will also be under no obligation to buy anything when you fill out our simple and secure online application. So, go ahead and get started today.