Financing a Car Loan as an International Student in Canada

Financing a Car Loan as an International Student in Canada

Posted on January 17, 2024

Are you an international student in the Toronto area? Recently arrived to study here and want a car to get around? You’re not alone in this. We had a client this week who was in this exact situation. That’s what prompted this post. Our auto loans team handled the client so we asked them to outline what the options are for car loans as an international student.

Car Loans as an International Student

It is possible to qualify for an auto loan as an international student but it depends on a certain set of conditions.

You’ll need a Social Insurance Number (SIN), a work permit and sufficient income to pay for the loan. All on top of your studies!

You can get a SIN from Service Canada. You will need documentation to prove you’re studying in Canada but it should be no problem getting one. As long as you follow the guidelines, bring all your paperwork and everything checks out, you’ll get your SIN immediately.

Once you have your SIN, you’ll need a work permit. That’s another administrative hurdle but not an insurmountable one. Again, provide the paperwork and you should get one quickly.

The work permit expiry date will be used as part of the auto loan application process.

International Students & Credit Scores

Your next hurdle is to build a credit score. If you just arrived in Canada, you won’t have a credit score here. Any credit score you built in your home country won’t work here.

There are programs for Ph. D students or other higher education students, otherwise, you’ll need to begin building a credit score.

Get a credit card from a reputable bank and use it. Pay it off every month, get a phone contract from a provider who makes entries on credit reports, and find a landlord that does the same.

If you need to buy a car right away without the luxury of time to build up your credit, look into no-credit car financing.

You Need to Prove Your Income

The final challenge is to get or prove income. Some international students have a monthly income from parents or investments. Others have to work in their spare time.

Again, Ph. D students have a little leeway here as Canada is a hotspot for studying at a higher level and future income is more assured.

If you have a job already, wage slips or salary statements will help. If you don’t have a job but have other income, bank statements demonstrating the amount and reliability will work.

Getting that Auto Loan

Once you have overcome these challenges, as long as you have a down payment of some kind, we should be able to get you an auto loan.

If you're ready for a car loan, we'd love to help with that! simply fill in the form below to get started.