It’s amazing how much can change in just a month. Everyone here at Car Loans Canada wishes you and your family all the best during this difficult time and hope that you’re taking the recommended precautions to avoid exposure to COVID-19. Nothing is more precious than your health, and we hope that you continue to enjoy it through this pandemic and beyond.
If you’re on EI right now, you’ve got a lot of company. Millions of Canadians have suddenly found themselves dependent on it due to the economic impact of COVID-19. In uncertain times like these, you’re bound to have many questions. Although it should by no means be at the top of your list, it’s important to consider how going on EI may affect your car loan. This is particularly important if you’re interested in applying for one while interest rates are low.
“What effect will EI have on my credit score?”
Although your credit report does maintain a list of current and previous employers, your type of employment is not reported. This means that the credit bureau does not report if you are full time, part time, seasonal or on temporary lay off. As long as your bills are being paid, your employment status won’t impact your credit reporting.
“How will it impact my car loan application?”
Although normally collecting EI benefits would indicate that you are unemployed and disqualify your application, there are some circumstances where this is not the case. Seasonal employees very often have periods of unemployment and are normally able to secure lending. Most people who are currently being laid-off, will be recalled to work by their employer. These lay-offs are temporary due to COVID-19 and with social distancing rules being defined, businesses are beginning to open up again. The lenders know, these measures are temporary and that we’ll all be going back to work eventually.
“Will a loan affect my EI benefits?”
If you’re worried that qualifying for a loan will somehow affect your EI benefits, we have more good news for you. The government does not track how you spend your money and deciding to buy a car does not disqualify you from the benefits you deserve.
We’re Here For You
Hopefully we’ve given you some good news or at least relevant some anxieties if you’re currently on EI. No matter how long this lasts, Car Loans Canada will continue working for you. Stay tuned to our blog for more coverage on the effect of the pandemic on our industry. We wish you and yours good health in the meantime.