Bank loans in Canada

42358POSTS

8 years ago

Hello,

Finances and banking can sometimes be a headache for many expats, especially when it comes to taking out bank loans.

Is it difficult for an expat to get approved for a bank loan in Canada?

What are the types of bank loans available for expats (mortgage/bonds; business loans; car loans; personal loans; student loans)?

What are the general conditions for expats to take out bank loans (interest rates; timeframe to repay loans, etc.)?

Which bank in Canada is the most popular or accessible for expats regarding loans?

Would you normally require the services of an accounts manager at the bank in order to facilitate the process of taking out a loan? Is this service free of charge?

What would happen in the case of an unpaid loan if you have to repatriate back to your home country or move somewhere else?

Are there any other options for loans aside from the bank in Canada, such as taking out a loan from your bank in your home country, or other types of companies not affiliated with banks, that give out loans?

Thank you for sharing your experience.

Priscilla

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Alec Inglis Active member

40POSTS

8 years ago

Canadian banks have a conservative policy for lending. Loans are granted based on three factors, A. your CREDIT HISTORY in Canada, (you have none as yet) the SECURITY for the loan you can offer (a house mortgage, a lien on a car, a term deposit, a guarantor) and your apparent ABILITY TO PAY BACK.. meaning a job/salary you have in Canada for a sufficient period of time (none?).

With that criteria, immigrants have an easier time (at first) getting a huge mortgage loan for a house than a small loan without.

PEI Red Contributor

147POSTS

8 years ago

Expats from the United States might have an easier time accessing credit as some financial institutions are able to access US credit bureau reports. If I was a foreigner in Canada, I would stick to credit unions that have a more open door policy to those that don't fit a standard economic mold. Most are willing to work with new clients (members) and help them develop a credit rating in Canada, as well as navigate a system that might differ from their home country.

In the interim, they may want to maintain any lending vehicles they have in their home country (if that's an option to them) until they can establish some sort of decent Canadian credit history. I began with a department store credit card, but this can be a costly path, if you don't understand how credit cards work. Canadian laws are slightly more equitable than in the US, but that doesn't mean that you can't get burnt.

As Alec Inglis stated, most financial institutions are conservative in their lending policies. I would strongly advise new comers to avoid pay day loans and third party lenders that offer rates that border on usury. There are ways to establish a credit history in Canada (the most popular credit bureau company is Equifax) that can include secured loans and/or credit cards and co-signers with established credit. It's not an easy road, but it IS possible to achieve.

kedirA Member

1POSTS

8 years ago

Hello, Thank you very much for your email. Am very pleased to get the opportunity of the loan. I here as you is the opportunity accessible for out side Canada? Thanks