How to buy a car in Manitoba as a Newcomer

Whether you’ve just arrived in Manitoba or plan to do so soon, there are likely a few big purchases you’ll make once you arrive. As in most places, you’ll need a loan to purchase a vehicle or a house – but maybe this is the first time you’ve been introduced to the terms “credit score” and “credit history”. Your previous country may have had a different system for evaluating credit and being approved for a loan, so it may take some time to learn.


What is a credit score in Canada?

Your credit score is the three-digit number that determines your financial reliability as a lender. Your score can range from 300 (poor) to 900 (excellent) with good credit sitting around the 650 mark. The higher your score, the better rates, and financing opportunities you’re likely to get as a lender.

That being said, if you’re new to Canada, you likely haven’t had a chance to build your credit history. Your credit history is a record of your loans/debts that showcases your ability to repay them responsibly over the years. The longer your history of good repayment, the better your credit score will be.

When you move to Canada, you can start building your credit almost instantly – and we’ll tell you how.



Apply for a credit card


One of the easiest ways to build credit is to use it! By taking out a credit card and making your payments on time, you’ll be able to build your credit in a relatively easy way.

There are a few credit card options you can consider:


  • Unsecured credit card. As a new immigrant, you should be able to get an unsecured credit card from your bank of choice. Typically banks will offer you a lower line of credit to get you started so you can build your credit history.
  • Secured credit card. If you’re unable to get an unsecured credit card without a credit history, you may be eligible for a secured credit card. The difference with this card is you’ll be required to pay a refundable security deposit that’s usually the same amount as the card’s credit limit. With this card, your payment habits will be reported directly to the credit bureau which can be a bonus if you’re trying to improve your credit quickly.

Pay your credit card on time

As common sense as it may sound, paying your credit card on time, every time, is an easy way to boost your credit as it shows you’re responsible enough to consistently make your payments. To a lender, you’ll be considered a reliable borrower. On the flip side, lenders will interpret missed payments as irresponsibility and will be more hesitant to lend you money. Consistently missed payments will also damage your credit score, so it’s important to pay your credit card on time.

Pay off the full balance of your credit card

To avoid having your debt become unmanageable, it’s a good idea to pay the full balance of your credit card each month. If you only pay the minimum amount, your debt will be carried into the next month and you’ll end up paying more interest over time. Try not to use more than 30 per cent of your available credit in order to keep your costs down. If you’re unable to pay off your credit card, you’re spending more than you can afford. Keep an eye on it so you can live within your means and you’ll be good to go.


Pay your bills on time

Paying your other bills on time may not directly impact your credit, however, it’ll help you build good habits and prevent you from missing payments (which would negatively impact your credit).


Take out a car loan

Like we said earlier, you have to use credit in order to build credit. A great way to do so is take out a vehicle loan! Having a vehicle loan with regular payments will give you a chance to build your credit and show lenders they can count on you.


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