Key Takeaways:
How long should you wait to buy a car after getting a new job?
There is no need to wait. If you are a full-time, part-time, or casual employee, some specialty lenders will consider your application from Day 1.
What if I am still in my probationary period?
Some big banks will require you to complete probation. However, a number of non-bank lenders will approve car loans after just one day in the job.
I just started a new casual job, can I apply for a car loan?
Yes, but there are fewer lenders who will approved your loan. After 3-6 months your options will be far greater, but if you need a car urgently there are lenders who will consider your application.
I’m self-employed (ABN) and just started. What are my options?
If you are a tradie there are some lenders who will consider a low-doc ABN loan after one day. However, most lenders will require six months since your ABN was registered.
Does staying in the same industry help my application?
Yes. Lenders consider the stability of your earnings and staying within the same industry reduces the risk of a new job.
In most circumstances, you can get a car loan even if you have recently started a new job.
The minimum tenure requirements will differ depending on whether you are a full-time employee, casual, or run your own business.
Demonstrating stability of income in the past and predictability of future income is one of the main factors in a loan assessment.
If you are considered higher risk then fewer lenders will approve your application, and your interest rate may be a little higher.
In this article, we will discuss how lenders consider each employment category and whether you can get a car loan after starting a new job.
Car Loan Employment Explained
Lenders in Australia have strict eligibility requirements for their auto finance products, and their policies change frequently!
Employment is just one of these requirements that will have specific thresholds for each employment type.
The stability of your income is a critical factor when borrowing money and if you don’t meet these thresholds you could be rejected immediately.
However, some lenders will be more flexible in certain circumstances, but many will not.
Industry vs Employer
Some lenders may be flexible on their eligibility rules if you have moved to a new job in the same industry.
This will be assessed on a case-by-case basis, and the longer you have been in the industry the more likely an exception could be made.
A broker can be worth its weight in these circumstances!
They have a direct line to the lender and can provide context to your employment tenure when there are unique circumstances.
How Long Do You Need to be Employed to Get a Car Loan
The guidelines below will include the minimum employment tenure requirements for auto finance lenders on the Gusto Finance panel.
People often wonder how long you should wait to buy a car after getting a job, and the minimum requirements are usually lower than people think.
If you are a full-time employee, in most cases, you can get a loan the day after you have started your new job.
All are subject to change at any time, and for the most up-to-date information, you should speak to our brokers directly.
Full Time
Minimum tenure: 1 Day
If you are a full-time employee you will be eligible with some lenders after just one day. After you pass your probationary period your choice of lender can also increase significantly.
From a lender’s perspective, lending to a full-time employee is the least risky category. You are entitled to benefits like sick leave and holiday leave, which improves the predictability of your income.
Stable income equals lower risk in the lender’s eyes. So, there is a lower threshold for the minimum tenure to get a car loan than with any other employment category.
Casual Workers
Minimum tenure: 1 Day
While casual employment is one of the least stable categories of work, you will still be eligible for a car loan after just one day as a casual worker.
If you can demonstrate reliable and consistent income, then it will present well to the lender and you should have at least some options.
However, your options will increase the longer your tenure is.
As part of a car loan application, the lender will need to see your payslips and possibly three months of bank statements (in some circumstances).
Unlike full-time employment, you will not have personal leave entitlements. So this places you in a higher risk category when applying for a car loan as a casual employee.
Self-Employed (ABN)
Minimum tenure: 6 Months
If you have recently started your own business then navigating a car loan application can be tricky. But there are some lenders who will consider your application after just six months.
You may be asked to provide some additional documentation to evidence your income, so ensure you have good records ready to go.
Your options will also be limited until you can demonstrate two years of consistent earnings. So do not expect the best rates on the market, but a loan approval can still be possible.
Temp
Minimum tenure: Case by Case
You may be eligible for a car loan even if working as a temp. If a sufficient level of consistency can be demonstrated to a lender, and the outlook for the future is relatively certain then some lenders will consider your application.
Seasonal
Minimum tenure: Case by Case
It is much more difficult to demonstrate a consistently reliable source of income if you are doing seasonal work. But it is not impossible.
If you are a temp or a seasonal worker then having a finance broker working on your behalf may be the difference between an approval and a rejection.
So get in touch today to discuss your options.
Longer Employment = More Options
A basic principle here is that the more stable your employment the more options you have to find a suitable lender.
Short tenure and instability of income can place you in a higher risk category from the lender’s point of view, and some of the more conservative lenders may not be interested.
However, there are a number of non-bank lenders who specialise in this type of auto finance and will be willing to consider your application.
Just be aware that the interest rate is likely to be higher.
Apply Today – No Need to Wait!!
If you have changed jobs recently there will be options for you, assuming the rest of your credit profile is ok.
However, not all lenders accomodate those with short tenure so it is critical that you know where you arew most likely to be approved.
An expert broker can help negotiate this minefield of rules across a broad set of lenders, and find the best option for you.
