Your 36-Month Used Car Loan in Quebec: A Smart Path Forward
You're in a specific and strategic position. With a credit score between 600 and 700, you're on the cusp of prime rates and have good options available. Choosing a used car in Quebec on a 36-month term is a financially savvy move. This shorter term means you'll pay significantly less interest over the life of the loan and own your vehicle outright much faster. This calculator is tailored to your exact scenario, factoring in the unique lending landscape and tax advantages of Quebec.
How This Calculator Works for Your Profile
This tool is calibrated for Quebec residents with a 'fair' credit profile. It cuts through the noise to give you a realistic monthly payment estimate.
- Vehicle Price: Enter the sticker price of the used car you're considering.
- Down Payment: The amount of cash you're putting down. A larger down payment reduces your loan amount and can improve your interest rate.
- Trade-in Value: The value of your current vehicle, if applicable. This also reduces the total amount you need to finance.
The calculator then estimates your monthly payment based on interest rates typically offered to borrowers in the 600-700 credit range for a 36-month term on a used vehicle.
The Quebec Tax Advantage: Understanding the Numbers
One of the biggest benefits of buying a used car in Quebec is the tax situation. While new cars are subject to both GST (5%) and QST (9.975%), used vehicles purchased from a dealership are only subject to the 5% GST. This calculator automatically accounts for this, saving you nearly 10% compared to other provinces. For example, on a $20,000 used car, you pay only $1,000 in tax in Quebec, versus $2,600 (13% HST) in Ontario.
Example Scenarios: 36-Month Used Car Loans in Quebec (600-700 Credit)
With a credit score in the 600-700 range, you can expect interest rates from approximately 8.99% to 15.99% from our lending partners, depending on the specifics of your file. A shorter 36-month term often secures a better rate. Here are some realistic payment estimates using an average rate of 11.99%.
| Vehicle Price | Total After 5% GST | Loan Amount (with $2,000 Down) | Estimated Monthly Payment (36 Months @ 11.99%) |
|---|---|---|---|
| $15,000 | $15,750 | $13,750 | ~$455 |
| $20,000 | $21,000 | $19,000 | ~$628 |
| $25,000 | $26,250 | $24,250 | ~$802 |
Your Approval Odds with a 600-700 Credit Score
Your approval odds are high. A score in this range is considered 'fair' or 'near-prime' by most lenders. They see you as a responsible borrower who is actively managing or rebuilding their credit. Lenders will focus on two key factors beyond your score:
- Income Stability: Verifiable income of at least $2,000 per month is the standard baseline. Lenders want to see a consistent employment history. If you're receiving certain benefits, it's still possible to get approved. For more details, see our guide: EI Benefits? Your Car Loan Just Got Its Paycheck.
- Debt-to-Service Ratio (DSR): Lenders will look at your total monthly debt payments (including the new car loan) relative to your gross monthly income. They generally want this to be below 40-45%. The higher monthly payment of a 36-month term makes this calculation more important, so be sure you have room in your budget.
Even if you have some blemishes on your credit report, such as past late payments, lenders are often understanding. We specialize in these situations. In fact, Your Missed Payments? We See a Down Payment. Our team knows how to position your application for success. For those who have gone through more significant credit events, solutions are more accessible than you think. Learn more in our article, Consumer Proposal? Good. Your Car Loan Just Got Easier.
Frequently Asked Questions
What is a realistic interest rate for a 650 credit score on a used car in Quebec?
For a 650 credit score on a 36-month term for a used car, a realistic interest rate would typically fall between 9.99% and 16.99%. The final rate depends on factors like your income stability, down payment size, and the age/mileage of the vehicle. A larger down payment can help secure a rate at the lower end of this range.
Does a 36-month loan term improve my approval chances?
Yes, in many cases it can. Lenders see a shorter term as less risky because the loan is paid back faster. However, the monthly payment will be higher. Lenders will carefully assess your debt-to-income ratio to ensure you can comfortably afford the higher payment. If the payment is too high for your budget, a slightly longer term might be a better fit.
How is sales tax calculated on a used car from a dealership in Quebec?
In Quebec, when you buy a used vehicle from a GST/HST registered dealer, you only pay the 5% Goods and Services Tax (GST). You are exempt from paying the Quebec Sales Tax (QST), which is 9.975%. This is a significant saving compared to buying a new car or buying a used car in many other provinces.
Can I get a car loan in Quebec if I'm currently in a consumer proposal?
Yes, obtaining a car loan while in a consumer proposal is possible, although it requires working with specialized lenders. Lenders will want to see a history of on-time proposal payments and stable income. Approval often requires the consent of your trustee, but we have extensive experience navigating this process for our clients.
What is the minimum income required for a car loan with a 600-700 credit score?
Most lenders in Quebec look for a minimum gross monthly income of around $2,000 to $2,200. This demonstrates you have sufficient cash flow to cover the loan payment and other living expenses. The income must be verifiable through pay stubs or bank statements. Lenders are more concerned with stability and sufficiency than the absolute amount, provided it meets their minimum threshold.
