Even if you're not an Australian resident, you may still want to apply for a loan while you live in the country temporarily. Australian banks and financial institutions may not offer you a standard loan, but other solutions are available to UK migrants. Nonetheless, if you decide to apply for one of these migrant loans, it's important to know which lending criteria you may need to meet. Find out more here.
Your UK credit history is largely irrelevant in Australia. Australian financial institutions cannot normally access the information held by credit checking agencies in the UK. As such, the only credit history information that an Australian lender can generally use will relate to finance that you hold in Australia.
However, it's worth checking if your UK bank is part of a network in Australia. In these cases, the British and Australian banks can sometimes share data. As such, even if you're relatively new to Australia, you may get a loan based on your UK credit history. Even in this case, other lending criteria will normally always apply.
Visa type and duration
Australian lenders will also consider your visa when reviewing your application for a migrant loan. Information about your visa can help substantiate other parts of your application. For example, the lender will want to know about your current employer and the nature of the contract. If you are a UK migrant in Australia on a 457 visa, your paperwork will show the details of the company sponsoring you.
The length of the visa is also critical. A lender will not normally lend money to somebody over a period that exceeds the visa duration. For example, if you want to take out a loan over a two-year repayment period and your visa is only valid for twelve months, the lender is unlikely to approve your application.
As well as details of your current employer, a lender will want to know more about your general financial status. In the absence of credit history information, the lender will need to build a picture of your finances from other facts. Migrant loan applicants must often pass the lender's domestic lending criteria, as well as extra rules for migrants. As such, you may need to supply a lot of information.
You'll probably need to provide pay slips and a contract to prove your employment status. You may also need to provide statements that show your bank balance and details of your current outgoings and income – exactly as you would for a loan in the UK. Additionally, some lenders will ask you questions about certain transactions on your statements. You'll probably need to give a detailed breakdown of all your financial commitments and outgoings, too.
Australian lenders must meet the responsible lending obligations that the Financial Ombudsman Service sets out. These rules apply equally to migrant applicants. As such, lenders must take 'all reasonable steps' to decide if you can afford the loan, so you need to comply with all information requests in full.
UK citizens who want a loan in Australia may need to apply for special migrant loans. Talk to your bank or financial advisor for more details.