With so many makes, models and types of import cars on the market, finding one that’s suitable can be a challenging task. Many spend hours researching and comparing import cars to find one that’s suitable, but fail to spend time researching import vehicle finance and often find their bank or broker won’t or cannot provide an approval due to the vehicle type.
We receive many calls from customers puzzled as to why they have no problems borrowing against Australian complied or (sold new in Australia) cars but find it difficult to borrow against import cars and grey import vehicles.
iCREDIT has put together a few Import Car Loan tips to help you understand why not all car loans are equal.
Things to consider when looking at Import Cars
Age Of Vehicle – Most high performance import vehicles and people movers fall outside secured bank car loan guidelines as traditionally imports sold overseas and imported to Australia can be up to 10 years of age, if not older. Banks such as Esanda, St George, ANZ, Commonwealth, Macquarie, National Australia Bank and most Credit Unions will only provide unsecured personal loans for vehicles outside their car loan policy and due to the risk with unsecured lending, most lenders will cap their lending at a certain level.
Vehicle Type– Lenders assess loans based on risk and look at the “what if” factor, so should a customer default on their import car loan, and they need to resell the vehicle to recover funds it can be difficult finding a buyer specifically looking for a high performance vehicle. Most banks and financiers prefer to lend against vehicles sold new in Australia as they are comfortable in knowing these vehicles can be sold easily to recover funds.
An older model Nissan Skyline GTR, although may still have a market value of up to $30,000 can be difficult to resell from a lenders perspective.
Credit Check – Before applying, check your credit file as this will show if there is any unforseen debts that are owing to creditors. This will give you time to correct any problems that may show. Your Finance Broker will be able to provide a copy of your credit report, prior to submitting an import car loan to the banks.
Asset Position – When applying for import car loans and finance, you need to be thorough in noting your assets, bank balances, cash on hand and investments to assist with the application process. As the risk on the vehicle is higher to the lenders, having asset backing can help them make a favorable decision for you.
Employment– Lenders love to see employment and residence stability. If you can demonstrate uninterrupted employment and residence history, you stand a higher chance of receiving a better answer. Banks like to know where the vehicle is situated should a problem occur and showing transient employment and residence history adds risk to the transaction.
Lender – Compare, Compare, Compare is what you need to do when looking for an import car loan. If you have approached a bank or lender directly, with all the excitement of getting your new car, don’t settle for the first answer you receive without doing some research into the loan product. Ask the lender what monthly administration fees they may have? early payout penalties? ongoing fees? ability to repay sooner? and what type of interest rate loan are they providing? It’s easy to look at the loan repayment, knowing you can afford it, without looking at what other costs may be involved throughout the loan term. The finance consultants at iCREDIT are experts with import car loan banking criteria and can help you compare and choose a loan suitable to your budget and needs.
Typical documents to assist with Import Car Loans and Grey Import Vehicle Finance
- Tax Returns or Payslips
- Bank Statements
- Proof of current or previous credit
- Asset and Liability Statement
- Licence Suitable To The Vehicle Power To Weight Ratio
What Sets iCREDIT Apart From Other Financiers
iCREDIT have been providing Import Car Loans and Grey Import Vehicle Finance for over 20 years. Our professional automotive finance consultants can help you find, compare and choose import car loans and grey import vehicle finance suitable to your budget and lifestyle.
Contact us on 1300 350 118 or admin@icredit.net.au to discuss your car loan and finance comparison needs.
This article contains information on import car loan approval tips.
This information provided is a guide only. It should not be treated as financial advice and does not take into account your personal circumstances, financial needs or loan requirements. If you have any specific questions about financial matters or government legislation, you should consult an appropriately qualified professional or government department. iCREDIT endevours to ensure the information is accurate at time of publication, however cannot guarantee the ongoing accuracy this information.