What salary for credit approval in Canada? (SR+)

[Gloor]

Hey guys,

I've moved to Canada last year and I feel that my credit is excellent. Paid everything on time and I think I have a good income.
However, my application is conditionally approved as I'm waiting for one more document but as its taking a while, I would like to know what salary should one have in order to be approved? I just would like to gather some data to know where I stand on the salary scale and how to feel about my position.
Would you mind throwing some numbers to better let me understand it?
Any info or known stories about people who got approved and they are not making crazy money?
I just want some peace of mind (I think) to place myself at the right end of the "issue". Any info is appreciated. Thank you

 

[acarney]

Hey guys,

I've moved to Canada last year and I feel that my credit is excellent. Paid everything on time and I think I have a good income.
However, my application is conditionally approved as I'm waiting for one more document but as its taking a while, I would like to know what salary should one have in order to be approved? I just would like to gather some data to know where I stand on the salary scale and how to feel about my position.
Would you mind throwing some numbers to better let me understand it?
Any info or known stories about people who got approved and they are not making crazy money?
I just want some peace of mind (I think) to place myself at the right end of the "issue". Any info is appreciated. Thank you

I think it depends a lot more on how much you’re putting down, how long of a loan you’re going for, what kind of credit history you have (just a few credit cards? A mortgage you’ve been paying 5 or 10 years on) Student loan? Etc) and how long you’ve had a credit history.

Someone making $75,000 but with no loans before might have a hard time getting approved for 60 months or 72 months or something, especially if they’re only putting down the $2500 deposit. But someone with a lower income (~$50k) might not have issues if they’re putting down 40% or something, have paid off a 60 month car loan before, and are only asking for a 48 month loan etc.

 

[Dana1]

Hey guys,

I've moved to Canada last year and I feel that my credit is excellent. Paid everything on time and I think I have a good income.
However, my application is conditionally approved as I'm waiting for one more document but as its taking a while, I would like to know what salary should one have in order to be approved? I just would like to gather some data to know where I stand on the salary scale and how to feel about my position.
Would you mind throwing some numbers to better let me understand it?
Any info or known stories about people who got approved and they are not making crazy money?
I just want some peace of mind (I think) to place myself at the right end of the "issue". Any info is appreciated. Thank you

It’s a ratio between income and debt, plus credit score. Banks vary.

 

[OCR1]

Regardless of what the bank says, can you afford the car?

 

[jjrandorin]

@acarney and @Dana1 Answered this as best as it can be answered.. which is, there IS no "salary needed to buy XXX with a loan". It depends on debt to income ratio, and credit score / history.

You could make 200k a year but have debts that make the bank deny you a loan and you could make 60k a year with no debts and get approved.

There is no answer to this question, rather than asking people to talk about how much money they make on an online forum. I have seen examples of this in other car forums and that conversation or any variation of it (how much do I need to make to buy a BMW? What job does everyone do here to afford a BMW?) just turns into a !$!$#@% measuring contest.

 

[juls_esp]

only one way to find out... good luck i hope you get approved
the car is awesome

 

[gigawatt1010]

Credit Score - typically 720+
Loan To Value (LTV) - how much are you putting down, typically 20%
Debt To Income - how much do you owe in relation to your income, the lower this ratio, the better. Anything below 45% usually.

I think it’s pretty tactless to ask or say how much you make to complete strangers. Online or off

 

[Gloor]

I think my score should be 999. I don't have a debt, never paid anything late and my plan is to take it for 72 months (with minimum or no deposit) and pay it off in 24-36 months. I basically plan to pay double than what they need me to to reduce the interest and time as well. However, as the percentage doesn't go lower (or higher) with time I was adviced to take 60-72 monhts as it makes it lower payments and easier to approve. I think my problem is not the income (I hope, hence why I am here) but the fact that I moved to Canada last year and all my credit etc. history is in europe. So I can only 'prove' things in Canada for the past year which is why I believe that my credit score should be super high as I pay everything ahead and don't miss out a single thing. Even on Credit Card I haven't been charged a single cent of interest as I always pay it up in the grace period.
However, new country, new habits etc. Just little worried here so kinda wanted/needed some (hopefully) positive encouragement.

Ie. what do you think would be minimum (or median) salary that one should need for a SR+ model order.

 

[MikeBur]

I think my score should be 999. I don't have a debt, never paid anything late and my plan is to take it for 72 months (with minimum or no deposit) and pay it off in 24-36 months. I basically plan to pay double than what they need me to to reduce the interest and time as well. However, as the percentage doesn't go lower (or higher) with time I was adviced to take 60-72 monhts as it makes it lower payments and easier to approve. I think my problem is not the income (I hope, hence why I am here) but the fact that I moved to Canada last year and all my credit etc. history is in europe. So I can only 'prove' things in Canada for the past year which is why I believe that my credit score should be super high as I pay everything ahead and don't miss out a single thing. Even on Credit Card I haven't been charged a single cent of interest as I always pay it up in the grace period.
However, new country, new habits etc. Just little worried here so kinda wanted/needed some (hopefully) positive encouragement.

Ie. what do you think would be minimum (or median) salary that one should need for a SR+ model order.

You can often transfer, or at least tie together, credit histories when emigrating. Find a common credit agency and ask for them to transfer your credit history file. Additionally, you originating bank can, and often will when asked, transfer your history with them to another bank.

You behavior of credit expectations may not be the same between originating country and Canada. Common themes are debt to income and ltv, as already mentioned. One area where you are incongruent is your belief you should have a perfect credit score as you have no debt; often no debt means no history and no ability to make profit from your debt. As you mention paying down the loan faster by over paying is less profitable for the lender and therefore you may not be as attractive as you believe.

Read: Credit Rating 101 - Debt Canada: Your Canadian Credit Education Centre

 

[Gloor]

Hmm, that doesn't comfort me.
I always had this assumption that those who lend the money want someone as solid as possible so there is almost no risk of them not getting money back so me paying everything on time etc. I assumed I would be the perfect candidate. I guess me asking here gave me the reality check and maybe its not as pink as I thought it would be.
Well, I've made a rule that if it gets rejected then I will take it as a sign and won't buy the car at all even when Tesla told me that there are other options.
And honestly, the more time it takes the more I'm hesitant and kinda have the buyers remorse (and the fact if I should get AWD instead of SR+).
Either way, the waiting is annoying but I'm sure the outcome will present itself soon. I'll keep you guys posted.
Thank you

You can often transfer, or at least tie together, credit histories when emigrating. Find a common credit agency and ask for them to transfer your credit history file. Additionally, you originating bank can, and often will when asked, transfer your history with them to another bank.

You behavior of credit expectations may not be the same between originating country and Canada. Common themes are debt to income and ltv, as already mentioned. One area where you are incongruent is your belief you should have a perfect credit score as you have no debt; often no debt means no history and no ability to make profit from your debt. As you mention paying down the loan faster by over paying is less profitable for the lender and therefore you may not be as attractive as you believe.

Read: Credit Rating 101 - Debt Canada: Your Canadian Credit Education Centre

 

[mreynolds767]

With a highest possible score of 850 it is very unlikely you have a 999 score.
In general there is no difference between 850 and 750 in terms of what you will get qualified for.
There are free websites that can provide you with your scores without it affecting your credit.

As stated the big factors are your history and Debt/Income ratios. Having lots of long term non-revolving debt (like another car loan or mortgage) that is partially paid off and still good ratios would look more attractive than someone without any similar debt but tons of income.
On Revolving debt like credit card debt which is treated differently you want to keep to 10% or less of your available credit.

Someone who likes to use credit and has shown a history of making payments is the customer they want as that is the customer they make money on while still keeping risk low.

All that said, based on what you have stated if you can make the monthly payment comfortably you should be approved ; Car loans are generally not that hard to get and if you have money to put down a larger down payment they get easier and easier ; so if you don't get approved you likely have an underlying issue like as you stated no history of your previous credit in Europe which is causing the problem and maybe something you can get corrected for the future.

 

[Gloor]

Thank you. Yeah 999 is in europe so I based it on that.
I think I'll go with the flow. Either it will be ok or it won't and I'll take it as a sign and won't get the car. I believe that things happen for a reason so I guess this will tell me what I am "meant" to get
Lets see

With a highest possible score of 850 it is very unlikely you have a 999 score.
In general there is no difference between 850 and 750 in terms of what you will get qualified for.
There are free websites that can provide you with your scores without it affecting your credit.

As stated the big factors are your history and Debt/Income ratios. Having lots of long term non-revolving debt (like another car loan or mortgage) that is partially paid off and still good ratios would look more attractive than someone without any similar debt but tons of income.
On Revolving debt like credit card debt which is treated differently you want to keep to 10% or less of your available credit.

Someone who likes to use credit and has shown a history of making payments is the customer they want as that is the customer they make money on while still keeping risk low.

All that said, based on what you have stated if you can make the monthly payment comfortably you should be approved ; Car loans are generally not that hard to get and if you have money to put down a larger down payment they get easier and easier ; so if you don't get approved you likely have an underlying issue like as you stated no history of your previous credit in Europe which is causing the problem and maybe something you can get corrected for the future.

 

[Kappelan]

In Canada, we have 900 max if I remember correctly and you need to have about 760+ to be in the "Excellent" category.