Can I get a car loan as a temporary resident in Australia?
Yes, some lenders are willing to offer a car loan to temporary residents in Australia.
However, lenders are likely to view this type of loan as higher risk and you'll probably need to meet certain criteria to be eligible for a loan.
Read on to find out how to apply for a car loan as a temporary resident in Australia, and how to maximise your chances of success.
Car loans temporary residents may be able to apply for
How does a car loan for a temporary resident work?
A car loan for a temporary resident is essentially the same as any other car loan or personal loan, except that lenders will generally apply more stringent eligibility criteria.
Provided you meet the relevant criteria and are approved for the loan, you'll then be given the amount of money needed to purchase a car, and you will enter into a contract to make repayments on the principal amount and the interest at regular periods over a set number of years.
Regardless of your status in Australia, the lender may have requirements about the type or age of car purchased with the loan. For example, a lender is unlikely to extend a car loan to purchase a car more than a few years old, or a car that has been in an accident.
What criteria might apply?
As a temporary resident, additional strict lending criteria and other considerations will apply, including:
- Loan term. While a typical loan term for a car loan is five to seven years, a lender will likely not offer a loan term that extends past the expiration of your current visa. Generally, the loan term will end at least three months before the expiration of your visa. Note that lenders will only consider your current visa and will not rely on pending visa applications or extensions, no matter how likely their success.
- Visa type. Some lenders will only extend credit to temporary residents holding certain types of visas. People with student visas and temporary work visas with a path to permanent residency will have a greater chance of success than someone on a provisional or bridging visa with no set expiry date. If your visa has been sponsored by an employer, this will greatly improve your chances of success.
- Credit history. For Australian citizens, lenders look at an applicant's credit history when considering a car loan application. Temporary residents typically have little or no credit history in Australia, and Australian lenders do not consider overseas credit history. For this reason, lenders will place more emphasis on an applicant's deposit, income and employment status.
- Visa breaches. Many visas have strict limitations on the number of jobs that can be held or the number of hours of employment each week. While it is important to maximise your income before applying for a car loan, lenders will not lend to anyone in breach of the conditions of their visa by working extended hours or multiple jobs.
How do I know if I am eligible for a car loan?
The lending criteria for a car loan for a temporary resident will vary between lenders. As always, it is important to consider the criteria of an individual lender before applying.
As with all car loans and personal loans, different lenders will have different requirements in relation to income, employment history, loan terms, deposits and lending amounts. But of particular significance to temporary residents is that some lenders will not offer a car loan to temporary residents at all, while others will only consider temporary residents holding certain visas. Additionally, lenders will have different criteria regarding how long you have been in Australia, how long you intend to stay in Australia, and your employment stability.
Examples of visa requirements for temporary residents include:
- ANZ. Only holders of 457 work visas and diplomatic visas will be considered. Working holiday visa holders will not be accepted.
- Bank of Melbourne. A minimum of two years remaining on your visa at the time of application. Must hold a visa contained on an extensive list of acceptable visa numbers.
- BankSA. A minimum of two years remaining on your visa at the time of application.
- CommBank. Will consider applications from holders of 457 working visas.
- CUA. Will consider applications from holders of 457 working visas.
- Fair Go Finance. 457 working visa holders will be considered. Centrelink payments are taken into account when determining income.
- NAB. A minimum of 12 months remaining on your visa at the time of application. New Zealand citizens and 457 working visa holders are preferred.
- St.George. A minimum of two years remaining on your visa at the time of application.
- Westpac. Only applicants with a visa on an extensive list can apply.
How can I increase my chances of being accepted?
Car loans for temporary residents are considered a high-risk endeavour for lenders. Once you have satisfied the eligibility requirements you can improve your chances of being accepted by considering the following factors:
- Cash deposit. The greater the deposit you can offer, the greater your chances of success.
- Proven savings. If you can show that your cash deposit is a result of your savings efforts while working in Australia, this will be more favourable to lenders than if your deposit was a gift.
- Income level. Income of $50,000 per annum or higher will put you in a good position when applying for a car loan.
- Regular income. Lenders need to be satisfied that your employment is stable and your income is regular. In some cases, lower regular income will be more favourable than intermittent or seasonal income, even if it is higher.
- Guarantor. If you can find someone who is prepared to go guarantor on your loan – to agree to be responsible for the loan should you default on the repayments – this will be looked upon favourably by lenders.
- Australian bank account. Most lenders will want to see that you have an Australian bank account into which your income is deposited. Be prepared to provide bank statements for at least the last three months.
How do I submit my application?
Most lenders allow applications for car loans to be completed online, making it a simple and easy process. On the other hand, since there are more stringent requirements for temporary residents to obtain finance to purchase a car than for Australian citizens or permanent residents, an online application is not always a good idea.
Every time an application for credit is made, this is noted on your credit history. Making too many applications within a short period of time can negatively affect your credit history – and this is particularly significant for temporary residents who may have little to no existing Australian credit history.
It can be a good idea to do the groundwork first to work out which lender could be the best choice based on your circumstances. Then, make an appointment to speak with a car loan officer at your chosen bank or financial institution.
Lenders do have a certain amount of leeway when it comes to deciding whether to extend credit to a temporary resident. For this reason, an in-person appointment will give you the opportunity to state your case and show that you are a good candidate for car finance – something that is not possible with an online application.
Don't forget to get your car covered before you hit the road. If you aren't sure what cover to get, take a read of our car insurance comparison guide or if you are still unsure about what vehicle to buy, we have a car review section too!
More guides on Finder
-
Australian Vs. USA car prices 2017
Aussies are paying up to 185.14% extra for vehicles compared to our American friends.
-
BMW Finance 2024
How to find the finance you need to purchase a brand-new BMW.
-
Car loans for classic cars
Want to buy a classic car but don't have the ready money? There are still financing options available for classic vehicles. Find out what loans you have to choose one and which one will work best for you.
-
Tesla buying guide
If you're looking at purchasing a Tesla – Model S, Model X or Model 3 – this guide will show you how to choose a vehicle and make your purchase.
-
How do you sell a car under finance?
Read the guide on how to sell an encumbered vehicle to find out the extra steps involved.
-
Tesla Superchargers Map: Where you can charge in Australia
Find out the extent of Australia's Tesla Supercharger network with our complete map of every charging station.
-
How Uber car loans can help you get on the road
Need a new loan for your next Uber car? Find out what is on offer here.
-
Macquarie car loans
Get funding for a new or used car, motorbike or caravan as well as access to a complimentary car-buying service with a Macquarie Car Loan.
-
IMB New Car Loan
Read our review on the IMB offers a competitive fixed with its New Car Loan to help you finance a new car or one that's up to two years old, and find out if you're eligible to apply today.
-
Cheap Car Loans Australia
When you're shopping around for a new car, you surely want the cheapest car loan possible.
Ask a question
Hi, I am international student and I hold student visa (500 subclass). I would like to ask if I can find a chance to get car loan or not. I have scholarship and I get monthly income.
Thanks
Hi Rob,
Thanks for your comment and I hope you are well.
Yes, you are able to get a car loan while on student visa subclass 500. Essentially, it is the same as any other car loan or personal loan, except that lenders will impose additional stringent eligibility criteria. The requirements also vary on the type or age of car purchased with the loan.
Also, your eligibility will depend on how many months are left in your visa. It will typically end at least three months before the expiration of your visa. In terms of credit score – since this is unavailable, lenders will place more emphasis on an applicant’s deposit, income and employment status.
You can review the lenders listed on our page and you can read more about them when you click the MORE INFO. If you’d like to be redirected to their official page, please click the green Go To Site button. Know that this is where you will start the application process.
I would suggest reading the part of our page saying “How can I increase my chances of being accepted?” To add to that, carefully review the eligibility criteria of the loan before applying to increase your chances of approval. Read up on the terms and conditions and product disclosure statement and contact the bank should you need any clarifications about the policy.
Hope this helps and feel free to reach out to us again for further assistance.
Best,
Nikki
I am on sub class 482 Visa. Can I buy a car on finance? I had arrived 3 weeks ago to Melbourne.
Hi Venkata,
Thank you for getting in touch with Finder.
Since we do not have the specific Visa type of who may apply for a car loan for a temporary resident, I suggest that you contact your chosen bank/lender to know the eligibility criteria like the Visa type. The lending criteria for a car loan for a temporary resident will vary between lenders.
I hope this helps.
Thank you and have a wonderful day!
Cheers,
Jeni
Hi im looking for a car loan! I have been in australia for 3yrs on a marriage visa in full time employment my permernent residency has not been processed due to back logs!
Hi Charlie,
Thank you for leaving a question with finder.
You are on the right page to see a list of lenders that could assist. Please scroll down to “How do I know if I am eligible for a car loan?”. This should give you an overview of what banks you could reach out to talk about taking out a car loan. Hope this helps!
Cheers,
Reggie