Buying a car in Quebec: the newcomer's guide

For a newcomer to Canada, a car quickly becomes essential, for work as much as for family life. Here is how to prepare your purchase, build your credit and get good car financing, even without a Canadian history.

Getting ready to buy a vehicle in Quebec

Financing rules vary with your residency status (temporary or permanent). Typical conditions at financial institutions:

• Down payment: 10% to 25% of the loan value (for loans of $10,000 and up);
• Maximum amount: roughly $75,000;
• Maximum term: up to 96 months for permanent residents, 60 months for temporary residents;
• Age of a used vehicle: 8 to 10 years maximum, depending on the institution.

Holding a valid licence

A valid driver’s licence is mandatory. If you held a licence in your country of origin, you have 6 months to obtain a Quebec licence.

Nationals of these countries can exchange their licence without an exam (class 5): Germany, Austria, Belgium, France, Great Britain, Isle of Man, Northern Ireland, Japan, the Netherlands, the Republic of Korea, Switzerland and Taiwan.

Residents of other countries take a skills test if they have held a licence for at least a year; without a licence, you have to take the training and pass both the theory and road exams.

Building your credit history, even before you arrive

Without a Canadian credit history, financing gets complicated. Three moves speed up building your file:

• Open a Canadian bank account early (ideally before departure) and use it regularly;
• Avoid any NSF cheque;
• Get a credit card and pay it before every due date.

Good news: we have first chance credit programs designed for newcomers, and a well-managed car loan is one of the best ways to build your credit quickly.

Budgeting for insurance and registration

Beyond the monthly payments and maintenance, plan for:

• Driver’s licence: roughly $90 per year;
• Registration: the amount varies by region (higher on the island of Montreal, lower elsewhere in Quebec); check the current rates on the SAAQ website;
• Car insurance: premiums vary with the insurer, your age, your driving experience, the vehicle and where you live. Compare several offers or go through a broker.

New or used?

A recent used vehicle offers advantages comparable to a new one: many are still covered by the manufacturer’s warranty or an extended warranty, for a fraction of the price.

How to finance your purchase

Bank or dealer?

1. A direct loan from your bank: mostly necessary if you are buying from a private seller;
2. Financing through the dealer: simpler, and with a lender like us the decision is made on site rather than in a system somewhere else.

Fixed or variable rate?

A fixed rate stays the same for the whole term of the loan; a variable rate moves with the market. For a tight budget, a fixed rate offers predictability.

How do you know if a rate is good?

Compare, always. A difference of a single percentage point on the rate on a 60-month loan represents several hundred dollars. The type of vehicle, its price and your file all influence the rate you are offered. See our guide on getting the best financing rate.

The 4 steps of financing

1. Opening the file: an advisor collects the documents to prepare: proof of income, contact details and banking information;
2. File review: your application is assessed here, based on your income, your stability and your capacity to pay;
3. Approval and signature: check that the payments and term match the agreement;
4. Delivery: proof of insurance in hand, you drive off with the keys, sometimes the same day.

We take care of you

Our specialists help newcomers finance their first car in Quebec every year, even with no Canadian credit history. Apply online: an answer within 24 hours.