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Been denied financing from both RBC and Scotia - suggested course of action

Discussion in 'Canada' started by [email protected], May 18, 2019.

  1. ATC@LWSK

    Joined:
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    So I ordered an SR+ on May 3rd and applied for financing through Tesla's website. Got a call from Tesla 2 days later telling me that my request for financing had been denied by both banks due to my temporary resident status in Canada (my family and I reside in Canada on a work permit received through my work), and we're in the process of obtaining permanent residence.

    Is there any suggested course of action I can take to convince the lenders to approve the loan? Anyone else in a similar situation who has been approved for financing? I had commited to a larger down payment ($7500 down) on the website but it seems like it wasn't enough. I am able to increase the down payment even more, thus reducing the borrowed amount, and I can also guarantee the loan with cash savings (currently in another Canadian bank), but to whom do I communicate this? Tesla naturally doesn't wish to get involved in this sort of brokerage, so I wonder how to get in touch directly with the relevant departments and present my case? I still have the option to purchase the car in cash, but don't wish to resort to that. Any ideas?

    Thanks.
     
  2. GolanB

    GolanB Supporting Member

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    You always have the option of bringing your own auto financing loan to the table. I purchased two Teslas, one through Tesla financing, and one through my own bank's auto financing division. Tesla will release the car to you once they've received bank funding, and if you've got an existing relationship with a bank, you should try to use it. Ultimately, the most important thing here is the rate you'll receive on the loan - you may eventually find a bank willing to do it but at a high rate. Amazingly, I was able to negotiate my rates down to 1.99, but I've seen people sign with far higher rates.
     
  3. X.l.r.8

    X.l.r.8 Supporting Member

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    On a temporary SIN! That’s not an existing relationship with a bank. You could apply at your home bank if you still have one.
    Credit and SIN numbers that start in 9 will never go together.
    If you can buy the car in cash do it. If not don’t, you can always get a LOC later once you have a PR status to free up the money again.
    If you want to enjoy making payments you can have the bank open a GIC and you can get credit up to the amount you deposit. I stuck 10k in one just to get a credit card for a year while I got my PR sorted out.
     
  4. 03DSG

    03DSG Active Member

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    #4 03DSG, May 18, 2019
    Last edited: May 18, 2019
    Call Tesla finance. When I was buying last summer I spoke on the phone a few times to finance in the states. I’ll pm you the number I used.

    Sent
     
  5. ATC@LWSK

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    Tried with my current bank (TD), and was offered a line of credit with about 6,5% interest rate, but I declined. That’s a way steeper rate than through Tesla, and line of credit affects my other plans for the future. In short, it doesn’t work for me.

    Yes, my SIN is a temporary one and starts with 9. Funny thing is, when I moved here in September 2018, I applied for auto financing with Scotia bank about three weeks after moving to the country, through a used car dealer for a 2014 Q5 that I bought. Was approved within 24hrs at a 6,05% interest rate, 48 months. The vehicle was $27000, I put 25% down, and the rest was financed. Monthly instalment was $548. I paid the monthly instalments diligently (7 instalments), and when I sold the car this april, I paid off the remaining loan in full. Then, I ordered the M3 and applied for financing again, only to be declined this time. That’s what bothers me the most. Thanks for the number though, I got it in PM. That’s the same number that called me to tell me my financing didn’t go through.
     
  6. Casmium

    Casmium Member

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    Try some credit unions
     
  7. ATC@LWSK

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    Any suggestions? I've never worked with CUs.
     
  8. antoinearnau

    antoinearnau Member

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    The joy of being an immigrant, been there done that. It takes patience, but eventually all those bumps blur in the past.
     
    • Funny x 1
  9. Casmium

    Casmium Member

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    First try looking for a credit union based on your background, if that's not an option look for Duca, meridian or first ontario
     
    • Informative x 1
  10. X.l.r.8

    X.l.r.8 Supporting Member

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    I don’t believe you actually gain any credit status with that SIN, sometimes it slips through the net, you are not actually obliged to give your SIN number for your loan. You could try not filling the number out
    The Social Insurance Number Code of Practice - Section 2 - Canada.ca
    But in all honesty I never found it made any difference although I didn’t try hard as I had enough in cash to get by, but that’s what everyone told me when I was getting frustrated with my bank.
     
  11. Uncle Paul

    Uncle Paul Active Member

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    Banks have been burned by so many Ex-pats in the past that they have gotten wary of making them loans.

    In Saudi Arabia, when the recession hit hundreds of Ex-pats simply drove their cars to the airport and left them with the keys in the ignition. Then flew home, leaving the banks to deal with the mess.

    Maybe that is one of the reasons you are having a hard time getting a loan. At any time you can simply leave the country and the bank will have little recourse.

    You may need to put a larger down payment so the lender will not be stuck with they typical negativer equity at the beginning of a conventional auto loan.
     
  12. ben1628

    ben1628 Member

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    Nothing much u can do, using cash as collateral means nothing to the bank as it can be spent in second.
    That happens to Edmonton, Alberta some years ago. The Edmonton International airport was filled with unwanted, unpaid cars.
     
  13. versace_wang

    versace_wang Member

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    put a larger down payment with shorter terms matching your work permit should work.
     
    • Helpful x 1
  14. ATC@LWSK

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    Thanks for the suggestion. My work permit is only valid for another 14 months, but I've started the process for PR and expect to have it completed in the coming months. My options are either purchase the car in cash, or just wait until getting a PR and submitting a request for financing at that time.

    Still deciding which option to choose.
     
  15. versace_wang

    versace_wang Member

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    purchase cash then get a loan from bank to cover cashflow
     
    • Like x 1
  16. ATC@LWSK

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    No doubt. I lived in the UAE until recently and the stories of expats leaving their Ferraris and Porsches at the airport back in 2008 is all too familiar to me. What's puzzling is that I was able to get a car loan for a used car just 3 weeks after my arrival into the country, on a work permit, but not now.

    Alas, I have to make a decision and I'm working on it.
     
  17. Dutchie

    Dutchie Active Member

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    I had a huge difficulty in the beginning to get a car loan too as I did not have any credit history Canada mEven showing letters from the bank from my home country did not help. Eventually a rather wealthy friend helped me and signed as a guarantor. Is there anyone in your environment who is willing to sign as a guarantor? Perhaps your employer?
     
    • Like x 1
  18. ben1628

    ben1628 Member

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    Guarantor is not a good idea for the guarantor himself, he is effectively getting a loan for himself, it affects his credit rating and he is fully responsible for it. The only difference is you are paying the loan.

    Just delay buying the car until you are ready. It is going to be cheaper lol
     

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