Can I Buy A Car With No Credit In Halton?

Can I Buy A Car With No Credit In Halton?

Posted on April 5, 2021

If you’re new to Canada, a student or haven’t had credit before, you won’t have much of a credit history. This can provide something of a challenge when you come round to applying for a Halton auto loan. So, can you buy a car with no credit and what are your options?

Why your credit history matters

Your credit history is an outline of how you manage credit. Banks and auto loan companies don’t know you. They don’t know how good with money you might be or how high, or low, a risk you are for lending.

All they have to go on is how you have dealt with debt in the past using your credit history.

If you don’t have a credit history, you’re an unknown quantity. All those markers lenders would normally use to assess risk are not there.

You might think that living life so far without requiring credit is evidence enough that you’re good with money. In many situations it is. But when you’re looking for an auto loan, or any type of loan, it isn’t.

If a lender cannot gauge how much of a financial risk you might be, they will find it harder to lend to you.

Hard but not impossible

We said lenders would find it harder to lend to you, but we didn’t say they wouldn’t lend to you.

There are many auto loan companies out there who look past the credit history to the real story. They assess your income, your outgoings, whether you can afford the loan or not and a number of other factors to decide your level of risk.

You will likely pay a higher interest rate than someone with an established credit history but you can still get credit.

Increase your chances to buy a car with no credit

There are a couple of things you can do to increase the chances of being accepted for a Halton auto loan.

A large down payment

The larger your down payment, the more likely you are to get credit. Down payments insulate lenders from loss so the more money you put down, the more likely you are to get the loan.

Get a co-signer

If you know somebody with a good credit score who would co-sign the loan with you, that can also increase your chances. They are essentially guaranteeing that if you default, they will take over the loan.

Build your credit

While less than ideal if you have lived this long without it, building credit is a viable way to increase the chances of an auto loan. Use a credit card, use a secured credit card or even a credit builder card. Pay it off at the end of the month and you begin building credit.

It isn’t impossible to get a Halton auto loan with no credit. It’s just more difficult than if you had it. Work with the experts and nothing is impossible!

Contact Unique Chrysler for help, advice and competitive Halton car finance and leasing.

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