Getting a loan in Japan for foreigners is not impossible whereas Migrating to another country such as Japan is a challenge. This is like starting a new life in a different environment and you need a well-structured plan when it comes to money matters. There are a lot of processes before getting a loan in Japan. Please read this article to find out how to get a loan in Japan despite being a foreigner.
Foreigners in Japan can get a Personal loan, mortgage loan or a car loan. It is most important to understand the information regarding the entire procedure about how to get Loan in Japan.
Traditional banks, specialized consumer credit companies and P2P lending are the three types of loan providers in Japan. From the above loan providers, traditional banks are the best option to get the loan. If you are an eligible foreigner and if you qualify with their requirements, then they will provide you with a personal loan.
Factors That Impact Loan Eligibility
Age
You must be between 20 years old to 70 years old to apply.
Resident Status
Resident status will prove that you are living in Japan as a resident and currently have a registered address.
Japanese Language
Legal papers will be Japanese-written. It is better if you can speak, read, and write Japanese Language.
Employment and income
Banks will conduct a credit investigation to ensure your ability to pay a loan, including your ability to complete the payment without leaving the country too soon.
Loan Purpose
You may get a loan for mortgage, personal, business, vehicle financing or more other purposes. therefore, bank will check the reason why you need loan
Different types of loan that foreign can apply
Home/Mortgage loan
A simple definition of a mortgage is a type of loan you can use to buy or refinance a home. Mortgage/home loan may vary according to each financial institution or bank. This type of loan has the lowest interest rate. SMBC Trust Bank Ltd., Shinsei Bank, Bank of China, and Bank of Communications Limited handle housing loans exclusively for foreigners who reside in Japan and who have a stable income. Maximum Borrowing amount is 100,000,000 JPY.
Student loan
This type of loan is offered to college students and their families to help cover the tuition and other fees of higher education. To get this loan, the duration of your stay granted by your student visa needs to remain for at least 1 year. As of when you take up a loan,you have a stable income from your part-time job and savings.
Car loan
Among all the individual mortgage categories the car loan is the most popular kind of loan that most people go for. However, unlike most of the mortgages there is a limitation attached to it that is it cannot be used for multi purposes.
Personal loan
Personal loans let you borrow money to be used for any personal expenses and don’t have a designated purpose. Personal loan terms depend on your credit history. Seven Bank, Mizuho Bank are banks that offer personal loans.
Temporary Loan/Pandemic Loan
The Social Welfare Councils of all prefectures are providing a welfare fund loan system to lend necessary funds for living and other expenses to low-income households.
Special loans such as emergency small amount funds will be provided to households that are struggling for their living expenses as a result of temporary stoppage of work or unemployment.
Those who are hired only by a company will have the privilege to get a loan. The maximum amount is 200,000 JPY.
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