How to get a car loan with an ITIN number, in the USA is one of those issues that need to be researched thoroughly before going ahead with it. People normally assume that immigrants or those who are in the process of attaining a permanent resident status cannot purchase their own car as it may not be allowed by the government. But that’s not the case! The individuals residing illegitimately in the country can do car trade. How? Just with the help of a tax ID number! Although there are three different types of tax ID numbers which we will discuss below. But the one that is most suitable for acquiring a car loan is the Individual tax payer identification number, better known as an ITIN. People who already have an ITIN number are often found asking one question i.e. how to get a car loan with an ITIN number?
However, when it comes to obtaining loans for cars, the creditors may hesitate in giving loans to non-residents. But there are many dealers who value the needs of such individuals by offering ITIN car loans. You do not have to be a permanent resident or a citizen to acquire a car loan instead you can finance your own car easily with an Individual tax payer identification number, better known as ITIN. So before moving on the question how to get a car loan with an ITIN number, let’s discuss the ins and outs of an ITIN number.
What is an ITIN number?
Individuals often deem about a common issue i.e. how to get a car loan with an ITIN number, but first it is important to understand the functionality of an ITIN number. An income tax payer is issued an ITIN, which is illustrative for the taxpayer signifying that he/she earns a specific amount of income set by the tax authorities. The system of ITIN was pioneered in July 1996 in the United States of America by the ‘Internal Revenue Services’ (IRS) committee in order to assist the immigrants and foreign nationals in the US. ITIN is basically issued to individuals who do not have an access to the SSN (Social Security Number). In this regard, ITIN is highly beneficial and serve the non-residents and several other people so that the tax returns are properly filed and paid by these entities.
The sole reliant people are provided with a 9-digit number in terms of an ITIN (Individual Taxpayer Identification Number). These individuals particularly belong to the foreign stakeholders’ families or associated with these entities. Such a far-off stakeholder might be engaged in a business or employment in the United States of America and further desire to spend the remaining life in the country. These specific cases need individuals to obtain an ITIN number to pay off their tax liabilities.
The next point you need to know about how to get a car loan with an ITIN number is that, holding an ITIN number does not imply that the individuals are allowed to initiate a business in the United States. It actually enables the entities to file the tax returns so that they can take advantage of the governmental benefits, which other taxpayers also relish. It is important to fill up and act in accordance with the rules and guidelines given in the W-7 form for the acquisition of an ITIN number and get registered with the ‘Internal Revenue Services’ department of the country. In order to gain complete knowledge about how to get a car loan with an ITIN number, it is necessary to know about other tax ID numbers as well.
A social security number – SSN
Before knowing about how to get a car loan with an ITIN number, let us tell you about the Social Security Number better known as the SSN. An SSN is a 9 digit tax ID number and is particularly endowed to the entities that embrace E2 visa and wish to employ themselves in the United States.
The SSN numbers are hardly issued to temporary residents of the United States, while the permanent inhabitants of the country are beholder of it. It is liable to comply with the regulations stated in the SS-F form along with filling it up appropriately devoid of any inaccurate information, which will further lead to the cancellation of the request. But, when all the provided details and information are found authentic and verified by the U.S.C.I.S. – United States Citizenship and Immigration Services, then the applicant is granted an SSN number immediately.
An employer identification number – EIN
Before moving on to the main topic, how to get a car loan with an ITIN number, you must know about the third type of the tax ID numbers as well i.e. the EIN (Employer Identification Number). EIN also comprises of a 9 digit number corresponding to those of Individual Taxpayer Identity Numbers and the Social Security Numbers. This is an essential identification number, required by the government of the US when individuals desire to initiate their own business, either sole proprietorship, partnership or a company in the premises of the United States of America.
This Employer Identification Number (EIN) is also issued by the ‘Internal Revenue Services’ (IRS) department further providing benefits of filing tax returns. An EIN number can be accessed by means of providing details and information through the Form SS-4.
What is the difference between ITIN, SSN and EIN?
In order to have a better understanding about how to get a car loan with an ITIN number, it is important that you must know the difference between all three of them. Although car loans can be obtained through an ITIN but other tax ID numbers also helps in the attainment of loans.
ITIN: This tax number was created particularly for the non-residents of the United States, those who are living temporarily in the country. Individual tax payer identification number embraces a total of 9 digits, same as the EIN and the SSN.
SSN: The recognized formatting of the SSN no. is xxx-xx-xxxx and it is mainly given to the permanent residents of the United States, unlike the EIN number.
EIN: Any individual who desires to get engaged in any sort of business in the United States needs to hold an EIN number from the Internal Revenue Services. This will also help the EIN holder in filing tax returns and enjoying the benefits endowed to taxpayers. The preliminary distinction amid the EIN and the SSN number is associated with the formatting i.e. both comprise of 9 digit numbers but unlike the SSN number, the format of the EIN no. is xx-xxxxxxx.
Understanding this difference is significant because the answer of how to get a car loan with an ITIN number, is so vast that it’s important to cover each and every aspect of it.
ITIN for non-residents residing in the United States
Now coming to the main concern that how to get a car loan with an ITIN number, remember that you can attain a car loan with an ITIN even if you are non-resident in the country. Any individual residing in the United States and engaged in any sort of revenue-generating activity is liable to pay taxes imposed by the government regardless of the distinction of resident and non-resident status. Even, the people residing in the country illegitimately or with the consent of the government have to pay off their tax liability. How to get a car loan with an ITIN number is a very common question among the immigrants living in the US. If a non-resident is eligible to acquire an ITIN number, then his/her immigration procedure also get easier, as regular payment of taxes to the government, highlights you as an individual baring good moral character in the eyes of the government.
How to get a car loan with an ITIN number?
An ITIN number plays a vital role in the acquisition of not only a car loan but other important loans as well. Read on as we have listed few basic steps for you to know more about how to get a car loan with an ITIN number.
1. Apply for a Consular Identification Card (CID)
There is a need to obtain a US Consular Identification Card (CID) in adherence to the preliminary step. This Consular Identification Card (CID) represents the immigrant non-residency status and the consulate allots it to any person residing in the United States.
2. Apply for the Individual Tax Identification Number (ITIN)
Once a non-resident obtains a CID card, he/she should go ahead for the attainment of an ITIN number. No doubt a large number of non-residents dwell in the country but there is a certain amount that chooses to pay off their tax liability and file tax returns to demonstrate their willingness of continuous residence in the United States.
3. Establish a credit rating
Just as a non-resident attains an appropriate tax ID, he/she shall be permitted to open a bank account within a range of banks and then they can further proceed to acquire credit cards. This trend actually initiated in 2004 when Congress, with its tremendous efforts, made the government allows commercial banks to procure a CID card. Now, a non-resident individual must take the possession of two things i.e. a CID card and a bank account, so he/she can further proceed to execute credit rating. Immigrants after the attainment of these two commodities are allowed to pursue merchant loans for the purchase of smaller articles such as fixture, furniture, equipment or portable electronic items. Non-residents, in contemplation of creating their goodwill and clean records, should pay their bills and installments on timely basis. This will enable the creditors to agree for the grant of future loans, inclusive of car loans.
We are not done with the steps yet, so carry on reading to know about the next step on how to get a car loan with an ITIN number.
4. Find a car lender that accepts ITINs
When the bank receives a request for the car credit, they check the applicant’s credit antiquity by means of the SSN number. The SSN number cannot be given to non-residents, but they have an ITIN number, so they can utilize their ITIN alternatively, to fulfill the requirement. However, another issue is that, all creditors do not allow credits on the basis of ITIN numbers. Many of these lending schemes were cancelled when recession hit the USA in 2008, making rules firmer than before. Just pondering over the question how to get a car loan with an ITIN number, is not enough and you must contact the lenders to find out whether they offer car loans with ITIN numbers or not.
5. Apply for a car loan
The last step is to make use of the ITIN number for the attainment of loan for your car. If a creditor is ready to provide loan on the ITIN number then another requirement is to demonstrate at least $1500 as 30 days’ pre-tax income, which will be further validated by means of stub payments or using other documents. Afterwards, the loan applicant must pay a down payment of 10-20% in cash; whereas the mark-up rate will base on 5-20% monthly that will be settled on the applicant’s credit history.
These were the 5 steps on how to get a car loan with an ITIN number, now let’s move on to the dealers that offers such loans.
Entities that offer car loan with an ITIN number
An extensive number of banks used to issue car loans on the basis of ITIN numbers prior to the economic recession period of 2008 to sort out the immigrant market, specifically for the purpose of mortgages. After the recession period, majority of the banks discontinued offering car credit on the ITIN numbers and made the lending criteria more intricate. Somehow, a small number of lenders are still keen to endow loans on the basis of ITIN numbers and these may include calling different banks, credit unions and area dealers, asking for the ITIN numbers’ acquisition and if they have plans to attain an auto loan. These sources can also be found through web technology, as many of them give advertisements on their web pages, which may match your requirements as well. The details mentioned above on how to get a car loan with an ITIN number are not finished yet, so carry on reading!
What to Expect from an ITIN car loan?
The ITIN car loans were the lower risk loans as compared to the subprime loans back in the days of recession but things haven’t changed much as they are still unique and progressive. Loans granted with an ITIN number come with limited terms and conditions along with substantial interest rates. But you need to search for particular car dealers who deal in ITIN car loans; you will have to look for a network of dealers instead of any private vendor if you want to finance your car with an ITIN loan.
Now that you know the basics about how to get a car loan with an ITIN number, next step is to understand the procedure of applying for the loan.
How to apply for a car loan?
Do you apply to just one college for your higher studies or just one company for your job? You don’t right? The same goes for lenders as well! In the process of knowing more about how to get a car loan with an ITIN number you should know that you must not apply to just one lender for your car loan. Contact various banks, local credit unions, look out for other lenders and do a bit research on the services offered by each one of them. All the lending entities will ask you to submit an application for the loan along with your ITIN number, employment and revenue details, your monthly expenditure, mortgage or rents. Not only this, but you will also be asked about any outstanding debt that you may have such as a student loan or a credit card. If you are submitting your loan application to a variety of lenders then make sure to fill all the applications at once, if not then try to do it within a close time period at least. Submitting loan applications to multiple lenders will be a proof for the credit bureaus that you are in need of auto finance.
As we have brought the basic information on how to get a car loan with an ITIN number to your knowledge, now you must know about few other points while filling out a loan application. Remember that you will never be able to get a car loan if you write anything that is not true. Be honest while submitting your application, do not overstate your earnings or misstate your monthly expenses. The lenders will cross check each and every detail that you have mentioned in the application, they will go through your credit history, income information, debts and expenses. Once the lenders verify everything, then they will determine whether you should be offered a car loan or not.
So these were the basic details one should know about how to get a car loan with an ITIN number. But we have the answer of more common question for you, read on to find out!
Eligibility criteria for a car loan
There is a set of guidelines about how to get a car loan with an ITIN number, which should be followed by the residents. The below-mentioned guidelines must be met by the vehicle and the immigrant obtaining loan through a budding lender.
- The car desired to be acquired should possess an LTV ratio i.e. loan-to-value ratio between 85 and 115 %
- The car that is acquired should have covered a hundred thousand miles but should not be older than eight years.
- The acquired loan must be paid off within a time frame of 36 to 72 months
- For acquisition of the car, a down payment of at least ten percent of the original car amount or a minimum of one thousand dollars must be paid off.
- The minimum amount of income exclusive of tax payment should be $1400 monthly and should be provable.
- The applicant must be employed on the same job or in the same industry for at least a continuous 2-year time period.
- Likewise, the residence period at the same address should also be at least two years.
- The applicant must be a holder of the debt-to-income (DTI) ratio i.e. at least 35% including the new payment.
These were the essential details about how to get a car loan with an ITIN number; we hope you will get a better understanding by going through this blog before applying for your car loan. And next time if someone asks you the same question, how to get a car loan with an ITIN number? Just redirect them to this blog and they will get all their answers for sure!