7 tips for taking out a loan in Australia for overseas students
Need extra funds? It’s important to know what’s involved in applying for a loan.
Australia offers a wonderful lifestyle, and having access to extra funds could help you make the most of it all.
However, special rules apply to non-residents hoping to source a loan. For the full picture, take a look at our seven fast facts for taking out a loan in Australia.
1 Your visa matters
When it comes to lending for, say, a car loan, restrictions apply to non-residents. The type of visa you hold matters because not every type of visa will be accepted by all lenders. In addition, the remaining term of your visa will dictate the term of your loan.
2 Lenders will want to know about your income
Lenders are required by law in Australia to be sure that you can comfortably meet the loan repayments. This being the case, a lender who will accept the terms of your visa will want to know details of your personal income.
3 There are plenty of lenders to choose from
Over 50 banks operate in Australia as well as a large number of credit unions and building societies.
The sheer number of lenders increases the likelihood that you may find a lender who is happy to offer a loan.
4 It pays to shop around
The sheer number of lenders available means that it can take time to know which one is best-suited to your needs.
Interest rates on loans vary widely too, so it’s important to shop around to find the best deal for your situation.
5 Look at the total cost
It can be tempting to choose the lender with the lowest interest rate. But a low rate loan can come stacked with fees including upfront fees and monthly fees.
This highlights the need to consider the total cost of the loan, not just the rate you pay.
6 Don’t assume your own bank offers the lowest rate
If you have an account with a foreign bank operating in Australia, it can seem like an easy option to take out a loan with this bank. However, that can mean paying more than necessary. Chances are you could get a better deal with a different lender.
7 Mortgage brokers are loan experts
In an unfamiliar country, it can be challenging to know how you go about applying for a loan. Even Australians can find this confusing, and that’s why many turn to a mortgage broker for professional help. In fact, 55% of home loans in Australia are arranged through a mortgage broker1.
A broker can let you know how you stand in relation to securing loan finance. Some, like Mortgage Choice, offer a free car buying service that streamlines the process of finding a new car. For more information on how Mortgage Choice can help, click here (they even have Guides in Mandarin).