Loans available to non-residents in Australia

Do I need a credit history to access a loan in Australia?

Australian lenders can't access your overseas credit history, and if you’re new to Australia, then you won’t have yet built a credit file. But this doesn't mean loans will be inaccessible to you until you do.

Many lenders who approve migrant loans will use other criteria to determine their credit risk, assessing them on their financial situation, visa, assets, and overall ability to pay off the loan.

If you apply for too many loans in a short period of time after arriving to Australia, or obtain negative or bad credit history, this can damage your credit score with lenders. Maintaining a good credit history and keeping on top of your debts and bills will help increase your chances of successfully obtaining a loan.

Can I get a loan for a certain amount?

The amount you can borrow depends on the type of loan you get approved for. Certain lenders will let non-residents borrow from them, others won't. The Big Four banks (Westpac, Commonwealth Bank, ANZ and NAB) have options for non-residents, but they'll likely require you to meet some eligibility requirements first. This eligibility may involve you:

• Having stable employment / a source of income
• Having a visa
• Being able to repay your loan before your visa's expiry date
• Having an Australian residence
• Having an Australian bank account

The lender may require you to pay a higher interest rate on your loan, depending on your circumstances and how much of a risk they assess you to be.

Home loans for non-residents

Australia aims to promote growth by offering migrants easy options for home ownership, and as such, does not penalise permanent or temporary residents with things such as higher monthly payments. As a temporary or permanent resident, all the same terms, interest rates, and features (including offset accounts and the option to delay your mortgage payments under certain circumstances) that are offered to Australian citizens will be available to you. As such, the same eligibility criteria also applies. This includes;

What about migrants with permanent residence?

Migrants with a valid PR are eligible to borrow a higher percentage of the property value (on average, 90%). The exact amount will vary depending on whether you’re living in Australia, overseas, or if you’re a resident with a foreign income. Migrants with PR are also eligible for the first home owners grant (FHOG) so long as they meet the standard requirements i.e. they haven’t owned a home previously, intend to occupy the property as their principal place of residence for the first 12 months of settlement, and continuously live in the property for at least six months.

Personal loans for non-residents

As with home loans, migrants with a PR will generally find it much easier to obtain a personal loan than migrants on a temporary visa, but this doesn’t mean that temporary residents cannot access personal loans. Depending on your financial situation and visa, you may still be eligible for a number of personal loans including; car, secured, unsecured, and payday loans.

How do I get a personal loan?

Personal loans for both permanent and temporary migrants can be offered by traditional banks, credit unions, and smaller lenders. It’s important to familiarise yourself with the Australian market and compare your options to avoid unnecessary rates and fees before taking out a loan. A migrant’s lending risk cannot be determined by credit file (which is normally the first point of call when assessing any loan application), so the lender will determine the migrant’s risk on the strength of their overall profile and capacity to repay the desired loan amount. This is based on:

Temporary residents and students in particular may be required to meet a few extra requirements for their loan to be approved. You may need to provide a cash deposit to reduce the amount borrowed against your loan and minimise the lender’s risk.

If you’re on a temporary visa, your loan will NOT extend past the length of your visa. For example, if you have two years left on your 457, you will only be able to secure a two-year loan.

Personal loans available to migrants

• Car loans: Although car loans are usually restricted to PR and citizens, migrants on a 457 may have a better chance at being approved for a car loans so long as they meet certain financial conditions.
• Secured personal loans: When you use other assets, such as jewellery or property, to access finance, you’re taking out a secured personal loan. Unlike car loans (the monies of which you can only use to finance your vehicle), personal loans can be used to finance a variety of needs. Before taking out a personal loan, ensure that the purpose you intend for the loan amount is permissible.
• Unsecured personal loans: Unsecured personal loans don’t require any assets for security, which means these loans typically come with higher interest rates and fees. As there’s no security or assurance involved, unsecured personal loans may have stricter criteria and may not be available to migrants with certain lenders.
• Payday loans: These are small, short term loans, generally no greater than $2,000 and for no longer than a year. Due to these minimal amounts and lending time periods, migrants may find it easier to access payday loans than other, more long term and high risk loans.

Student loans for international students

Australia’s student loan system is called HELP (Higher Educational Loan Program). This is a government initiative that provides students financial aid to fund their education. Unfortunately, international students are not eligible for HELP, but this doesn’t mean that financial assistance systems aren’t available to them.

The first port of call for international students requiring financial aid is their educational institution. Most universities offer grants and scholarships, while some also offer student and general purpose loans for full fee-paying onshore international students or students with permanent residency. Note that all loans are subject to the university’s student loans policy and are granted at the university’s discretion.

Frequently Asked Questions

• Can you get a loan if you are not a permanent resident?

  Yes, non-permanent residents can get loans in Australia, but it often depends on the type of visa and the lender's criteria. The loan value and loan term will also play a part. You're more likely to be offered a loan if you're on a sponsorship visa compared to a working holiday visa, for example. This is because the lender knows you have secure work and income, as well as a longer time period on the visa to pay off the loan. If you're on a sponsorship visa, you should make sure you don't apply for a loan term that goes past the end of your visa expiration date. Some lenders may require a larger deposit or additional documentation.

• Do I need a Licence to lend money in Australia?

  Yes, if you want to lend money as a business in Australia, you generally need an Australian Credit Licence (ACL). This ensures compliance with Australian financial regulations.

• Can international students borrow money in Australia?

  Yes, international students can borrow money in Australia, but loan options may be limited. Lenders may require a guarantor or a higher interest rate due to the perceived risk. Learn more money tips with our international student hub.

• Is borrowed money taxable in Australia?

  No, borrowed money is generally not taxable in Australia as it is considered a liability, not income. However, any interest earned on loaned money would be taxable.

Written by

Stephanie Yip

Editor

Stephanie Yip was the shopping editor at Finder. Previously she was Finder’s travel editor and before that was our lifestyle writer. She has been writing in the travel, shopping and lifestyle space for over 15 years. During her time at Finder she was featured in a number of publications including The Daily Telegraph, The Guardian Australia, Travel Weekly, Escape and KarryOn. Before joining Finder, her previous jobs include editor for kids' magazine DMAG and writer for Thomas Cook and Wizz Air's in-flight magazine. Stephanie previously studied a Bachelor of Communications from the University of Technology Sydney, Australia. See full bio

Stephanie's expertise

Stephanie has written 12 Finder guides across topics including:

• Travel (flights, hotels, experiences)
• Shopping and lifestyle
• Seasonal sales events
• Money-saving tips