Getting a car loan as a temporary resident in Australia can be challenging, but it may be possible with the right lender. While many will only accept applications from Australian citizens and permanent residents, others are open to working with temporary visa holders who meet their criteria. Navigating the process can be complex, but Savvy’s experienced brokers are on hand to help you explore your options.
Which temporary visas are eligible for a car loan?
Not all visa types will be accepted for a car loan and eligibility varies from lender to lender. At Savvy, we work with a wide panel of lenders that may be able to help temporary residents on the following visas:
- 188 (Business Innovation and Investment (Provisional) visa)
- 403 (Temporary Work (International Relations) visa)
- 444 (Special Category visa (SCV))
- 461 (New Zealand Citizen Family Relationship visa)
- 482 (Skills in Demand (SID) / Temporary Skills Shortage (TSS) visa)
- 485 (Temporary Graduate visa)
- 489 (Skilled Regional (Provisional) visa)
- 491 (Skilled Work Regional (Provisional) visa)
- 494 (Skilled Employer Sponsored Regional (Provisional) visa)
- 500 (Student visa)
- 590 (Student Guardian visa)
- 785 (Temporary Protection visa)
- 790 (Safe Haven Enterprise visa)
- 820 (Partner visa (temporary))
- 866 (Protection visa)
- 870 (Sponsored Parent (Temporary) visa)
- 884 (Contributory Aged Parent (Temporary) visa)
In select cases, we may be able to assist applicants on Bridging visa A (subclass 010) or Bridging visa C (subclass 030), though your chances of approval will be slim. Your best chance lies in having full-time employment and a clear pathway to permanent residency, which can help demonstrate stability and reduce the risk in the eyes of a lender.
If you are on a visa that has been repealed but remains valid, you may still be eligible for a car loan if lenders previously accepted that visa, provided you meet the lender’s other criteria. For example, the 457 visa was abolished in Australia in 2018 but temporary residents already on this visa can continue to apply for finance.
- If your temporary visa isn’t listed above, we’re unable to assist with a car loan. This includes visitor visas, working holiday visas and other bridging visa subclasses.
How does a car loan work as a temporary resident?
A car loan works much the same way for a temporary resident as it does for anyone else: you borrow money to buy a new or used car, then repay the amount borrowed, plus interest and fees, through regular repayments over an agreed term.
However, qualifying for a car loan can be more difficult on a visa. Fewer lenders may be willing to consider your application, and those that do may apply stricter eligibility criteria or charge a higher interest rate.
The loan term will also need to end before your visa expires. A shorter loan term can mean higher repayments, so it’s important to consider the vehicle price, deposit and loan term together.
You can use our car loan repayment calculator to estimate your repayments and see how changing these figures could affect the overall cost.
Example: How Emily financed a car as a temporary resident
Emily moved to Perth six months ago on a four-year SID 482 visa to work as a healthcare professional. With long shifts, irregular hours and limited public transport near her workplace, she quickly realised she needed a car to get to work.
Although she had a stable income of $85,000 a year, she was unsure whether she could qualify for finance as a temporary resident.
Rather than trying to work out which lenders might accept her visa, Emily spoke to a broker. They reviewed her circumstances and found a suitable lender that worked with applicants on her specific visa. This saved her from having to contact lenders one by one, reduced the chance of applying somewhere unsuitable and helped move the process along more quickly.
Emily found a used Hyundai i30 for $15,000. With $3,000 of savings to put towards a deposit, she was quickly approved for a $12,000 car loan at 9% p.a. over three years, with the loan term ending before her visa expired.
Spreading the cost over three years kept Emily’s repayments manageable alongside her rent and other living expenses, allowing her to get on the road sooner without placing unnecessary strain on her budget.
| Cost | Amount |
|---|---|
| Monthly repayment | $382 |
| Total interest | $1,737 |
| Total repayments | $13,737 |
Note: This is an illustrative example only, based on an example interest rate and excluding fees and other charges. Approval and the actual interest rate offered will depend on the applicant’s circumstances, credit history and the lender’s eligibility criteria.
Why do lenders assess temporary residents differently?
Lenders are more cautious about approving car loans for temporary residents due to the higher level of risk involved.
Some of the main risk factors include:
- Leaving Australia before the loan is repaid: a temporary resident may need to leave Australia if their visa expires, is cancelled or their circumstances change unexpectedly. If the borrower moves overseas and stops making repayments, it’s more difficult for the lender to recover the outstanding debt. However, leaving Australia does not cancel your loan obligations and you are still required to repay your loan as agreed.
- Limited financial footprint: temporary residents may have a shorter Australian credit history and fewer assets in the country. As Australian lenders will only assess the financial and credit information available to them in Australia, this can make it harder to judge the applicant’s repayment history.
- Employment or income limitations: some temporary visas restrict the hours a person can work, the type of work they can perform or how long they can remain employed in Australia. This can affect income stability and make it harder to qualify for a car loan.
- Visa breaches or cancellation: lenders will not approve a loan if you are breaching the conditions of your visa, such as working more hours than permitted or holding unauthorised employment. A breach may also affect your right to remain and work in Australia, increasing the risk that you could lose your income or have to leave the country before the loan is repaid.
Get the right support from the start
"Every lender looks at temporary resident applications a little differently, and the options available will depend on your visa type and individual circumstances. That can make it difficult to know where to start, particularly if you’re new to Australia and unfamiliar with how car finance works here.
A broker can explain what lenders are looking for, help you prepare your application and narrow down which lenders may be a good fit. We know what different lenders are looking for and can guide you through the process from start to finish."
What lending conditions could temporary residents face when applying for a car loan?
Temporary residents may face stricter lending conditions compared to Australian citizens and permanent residents. This may include:
- Shorter loan terms: lenders will require the loan to be repaid before your visa expires, and most will set the end date several months earlier. Because many temporary visas are only valid for a few years, this can leave less time to repay the loan and result in higher monthly repayments.
- Smaller loan amounts: a shorter loan term can also limit how much you are able to borrow. Even where your income is strong, the lender still needs to be satisfied that you can comfortably repay the loan within the time remaining on your visa.
- Higher interest rates: due to your limited financial profile in Australia and the additional risk associated with your temporary residency, you may be offered a higher interest rate than an Australian citizen or permanent resident with similar financial circumstances. The smaller number of lenders willing to consider temporary residents can also reduce the range of competitive rates available.
- Limited lending pool: not all lenders accept car loan applications from temporary residents, and those that do may only consider certain visa types. This limits your options and can make it harder to find competitive rates and terms.
Tips to improve your chances of car loan approval as a temporary resident
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Build your credit
As a newcomer to Australia, your credit score will be almost non-existent, and you cannot use your credit rating from your home country. It might be daunting starting from scratch, but even things like paying your bills can help to build your credit score and reduce your level of risk in the eyes of lenders.
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Avoid multiple loan applications
Submitting several applications within a short period can affect your credit score. It’s better to identify lenders that may accept your visa and circumstances before applying, rather than submitting applications to several lenders and hoping one approves you.
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Choose a cheaper car
A less expensive vehicle can improve your chances of approval because you will need to borrow less and the repayments are more likely to fit comfortably within your budget. Choosing a smaller or used car may also make it easier to repay the loan before your visa expires.
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Use a co-signer
Applying jointly with a guarantor who’s an Australian citizen or permanent resident and has a strong credit history may improve your chances of approval. They will also be responsible for the loan, so it’s important that both of you understand what’s involved.
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Put down a deposit
While you may be able to get 100% finance to purchase your vehicle, having a deposit reduces both the amount you need to borrow (and repay) and the lender's risk. This can strengthen your application and may also help you access more favourable rates or loan terms.
How to apply for your car loan with Savvy
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Fill out our online form
Tell us about yourself and the loan you’re after.
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Supply your documents
Upload any documents we need to verify your profile.
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Get matched with a lender
Your broker will get in touch to talk you through your options.
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We’ll submit your application
If you’re happy to proceed, we’ll prepare and submit your application.
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Sign on the dotted line
Once approved, sign your documents and collect your car.
Why apply for a car loan with Savvy?
Car loan eligibility and documentation for temporary residents
Eligibility
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Age
You must be at least 18 years old.
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Residency
You must hold a temporary visa that is accepted by your lender. This will vary between lenders and many will only lend to Australian citizens or permanent residents.
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Income
You must be earning a stable income that is enough to comfortably support your repayments.
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Employment
You must be employed and earning a consistent income from your job.
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Credit score
You must meet your lender’s requirements related to your credit score.
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Car
Your car must meet your lender’s requirements related to type, age and condition.
Documents
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Identification
You will need to provide a copy of your passport to prove your identity, and your Australian driver’s licence if you have one.
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Visa documentation
You will be asked to provide visa documents, such as your visa grant notice, to prove your residency status.
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Proof of address
You can use utility bills, rental agreements or other documents to confirm your current address.
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Proof of income
You will need to show proof of your Australian income by way of recent payslips, bank statements and/or tax returns. You may also need to verify your employment through an employment contract.
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Car details
Information about your car, such as its age, is handy to have, though not a requirement.
