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$20,000 Car Loans

Find out your loan options to help you finance a new or used $20,000 car.

If you’re on the hunt for a new car and your budget is $20,000, you can choose from a range of new and used vehicles. Luckily, you also have a few financing options available to you depending on your needs and financial situation.

This guide will take you through these options including how they work, and their benefits and drawbacks to help you decide what’s right for you.

What loan can you get for a $20,000 car?

The types of loans you can get for a $20,000 car include:

  • A secured car loan. If you use your car as security for a loan you can benefit from a competitive interest rate. Keep in mind that you’ll only be able to borrow the value of the car, whether the car is new or used. Rates for secured car loans range from around 5% p.a. up to around 13% p.a.
  • Unsecured personal loans. With this loan, you don’t have to put forward an asset as security and you can also apply for whatever amount you want. This can be an option if you need additional funds to cover registration and insurance. However, the rates for unsecured personal loans tend to be higher, generally between 8-16% p.a.
  • Dealership finance. Dealership finance will get you a lower rate, which in turn will keep your repayments down. However, you are required to pay a balloon payment at the end of the loan, which can be thousands of dollars.
  • A novated lease. With this loan option, you are able to rent the vehicle for a monthly lease fee without retaining ownership of the vehicle, which belongs to the financier. Once your loan term has finished, you can either continue your novated lease or pay out to the financier to get the car with your name on the title.

Compare loans suitable to buy a $20,000 car

Rates last updated August 20th, 2018
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Monthly Service Fee Application Fee Product Description Monthly Repayment
Stratton Finance New Car Loan
From 5.29% (fixed)
6.56%
$18,000
1 to 7 years
$8.90
$459.20
Apply for up to $100,000 and have up to 7 year(s) to repay. You can use cash or trade in a vehicle to use as a deposit.
Loans.com.au - New Car Loan
From 5.44% (fixed)
5.99%
$5,000
3 to 5 years
$0
$400
This car loan is for new cars and offers a low fixed rate and no ongoing fees.
Beyond Bank Low Rate Car Loan
From 5.69% (fixed)
5.97%
$25,000
1 to 7 years
$0
$175
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.
IMB New Car Loan
5.99% (fixed)
6.34%
$2,000
1 to 7 years
$0
$250
Borrow up to $75,000 for a new car up to two years old. Competitive 5.99% p.a. rate available to all approved applicants.
Sydney CU Special Variable Car Loan
5.95% (variable)
5.95%
$10,000
1 to 7 years
$0
$0
Benefit from a flexible, variable rate to finance a car up to 3 years old with SCU. Note: Approval fee waived until 30th September 2018.
RACV New Car Loans
From 5.99% (fixed)
6.55%
$15,000
1 to 7 years
$0
$399
A competitive rate car loan from RACV with no monthly fees and 5-hour loan approval.
Bank Australia Car Loan
6.45% (fixed)
6.66%
$1,000
1 to 7 years
$0
$150
A competitive rate and the ability to offset your car’s carbon emissions for the loan term.
IMB Secured Personal Loan
6.89% (fixed)
7.24%
$2,000
1 to 5 years
$0
$250
All approved applicants can access this competitive rate and use the loan to finance a range of purposes. Loan amounts up to $60,000 available.
St.George Secured Personal Loan - Fixed Rate
From 8.49% (fixed)
9.6%
$3,000
1 to 5 years
$12
$195
Use your car as security and benefit from a competitive interest rate.

Compare up to 4 providers

Rates last updated August 20th, 2018
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Monthly Service Fee Application Fee Product Description Monthly Repayment
HSBC Personal Loan
From 9.5% (fixed)
10.06%
$5,000
1 to 5 years
$5
$150
A competitive fixed interest rate loan with the option to make extra repayments. Rates range from 9.5% p.a. to 15.99% p.a. based on your credit history.
SocietyOne Unsecured Personal Loan
From 7.5% (fixed)
9.51%
$5,000
2 to 5 years
$0
3% (of loan amount)
Based on your risk profile, you will receive a tailored rate between 7.5% and 20.49% with a SocietyOne personal loan.
Latitude Personal Loan (Unsecured)
From 13.99% (fixed)
15.19%
$3,000
2 to 7 years
$13
$250 (Loans under $4000 - $140)
An unsecured loan with a tailored rate from 13.99% p.a. to 29.99% p.a. designed for multiple purposes including renovating, buying a car or travelling.
Citi Personal Loan Plus
From 8.99% (variable)
9.96%
$5,000
3 to 5 years
$10
$199
Borrow up to $75,000 to use for a range of purposes. You’ll receive a rate of between 8.99% p.a. and 17.99% p.a. depending on your risk profile. (Comparison Rate of 9.96% p.a. to 18.91% p.a.)
RateSetter 3-Years Personal Loan
From 7.17% (fixed)
9.72%
$2,001
0.5 to 5 years
$0
$220
RateSetter offers loans with terms ranging from 6 months to 5 years and comparison rates from 6.39% p.a. - 11.08% p.a. based on your risk profile.

Interest and comparison rates calculated for a 3-year loan term.
Harmoney Unsecured Personal Loan
From 6.99% (fixed)
7.69%
$5,000
3 to 5 years
$0
$500 (Upfront fee)
Interest rates are tailored to each applicant individually, and start from as low as 6.99% p.a. to 26.95% p.a.. based on your credit history.
CUA Unsecured Fixed Rate Personal Loan
11.99% (fixed)
11.99%
$5,000
1 to 7 years
$0
$0
Apply for a loan up to $60,000 and keep repayments manageable with a competitive fixed rate.
MyState Unsecured Personal Loan
12.99% (variable)
16.42%
$3,000
1 to 7 years
$10
$200
Apply for up to $50,000 and make additional repayments at any time without penalty.
Pepper Money Unsecured Fixed Rate Personal Loan
From 9.99% (fixed)
9.99%
$5,000
1 to 7 years
$0
$0
Apply for up to $50,000 and receive conditional approval within minutes. Interest rates range from 9.99% p.a. to 21.74% p.a. The rate you are approved for depends on individual circumstances.
Westpac Unsecured Personal Loan
12.99% (fixed)
14.14%
$4,000
1 to 7 years
$12
$250
A competitive, fixed rate personal loan that allows you to make extra repayments.

Compare up to 4 providers

What features should you look out for in a $20,000 car loan?

Some of the features you should look out for in a car loan include:

  • Interest rates. Whether or not the interest rate is low is easy enough to spot. However, there is a difference between a fixed rate loan and a variable rate loan. A fixed rate loan has the same rate throughout the duration of the loan and offers peace of mind as your repayments remain the same. A variable rate loan fluctuates with the market and allows you to make extra repayments and redraw from them as necessary.
  • Fees. The fees that are associated with the loan is another consideration. No monthly fees are most beneficial. Two potential extra costs to watch out for are application fees and late repayment surcharges.
  • Balloon payments. It's important to know if you’re required to pay a balloon payment at the end of the loan. It means you are required to pay whatever is left on the loan when the term ends, possibly thousands of dollars.
  • Repayment flexibility. Whether or not your loan offers repayment flexibility is a feature to look out for. Some lenders allow you to tailor your repayment schedule to your cash flow, so you are able to pay weekly, fortnightly or monthly.
  • Do you own the vehicle? Owning the vehicle outright is important to consider as well. Although you might think you own the vehicle, this may not be the case depending on what type of loan you’ve decided to go with. Ensure that you own the vehicle if this is something you desire.

New vs used

There’s always going to be a new versus used vehicle debate. With a new vehicle, there is the peace of mind that comes with owning a brand-new car, like service warranty, no possibility of previous damage and let’s not forget that new-car smell. However, cars depreciate at a steep 40% in the next three years after owning a vehicle.

With a used car, you are able to benefit from a lower price if you get a well-maintained vehicle. While there is also the risk of going through a private sale and possibly not getting what you’ve paid for, this is less likely if you go through a registered motor vehicle reseller.

What are the main points to consider before you apply?

Some main points to consider before applying for the car loan include:

  • The loan cost. Although it might seem like you only owe $20,000, this isn’t entirely true. Once you factor in monthly fees, the cost of the interest rate that is applied to the loan and any late fees you might incur, this amount goes up considerably.
  • Personal situation. Suppose you come into some extra cash that you want to put towards your car loan. Have you chosen a loan that allows you to make additional payments? Is there a fee if you do? These are all important considerations.
  • Your employment situation. Is your current employment situation stable? Are you able to salary sacrifice in order to pay off your loan quicker? It's always beneficial to know these answers before applying for a loan.
  • Can you maintain a vehicle? In terms of a car’s running costs, factoring in the cost of fuel, insurance, vehicle registration, paying for your driver's licence and covering general vehicle servicing (if everything is running smoothly) expenses can add up quickly.

Have more questions about $20,000 car loans?

Should I get a secured or unsecured loan?

Ultimately, this is up to you. If you are able to put forward an asset as security, you can score a lower interest rate. However, if you don’t have an asset or are worried about losing the asset you’re putting up as security, an unsecured loan is a better option.

How old can my car be if I want to put it against my loan?

This depends on the lender. Some car loans will only accept cars that are a maximum of seven years whereas others don’t care how old the car is. Find out more in our used car loans guide.

What’s the maximum loan term for my car loan?

The maximum loan term varies between lenders. Some lenders will offer a five-year loan term whereas others will offer a ten-year loan term. Look into a variety of car loans and choose the one with the loan term that best suits your needs.


Picture: Shutterstock

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Car Loan Offers

Important Information*
IMB New Car Loan

Borrow up to $75,000 for a new car up to two years old. Competitive 5.99% p.a. rate available to all approved applicants.

Loans.com.au - New Car Loan

This car loan is for new cars and offers a low fixed rate and no ongoing fees.

Latitude Motor Vehicle Loan

Apply online to finance a new or used motor vehicle and receive a response in 90 seconds. You will receive a competitive tailored rate of between 6.99% p.a. to 14.99% p.a. based on your risk profile.

Stratton Finance New Car Loan

Apply for up to $100,000 and have up to 7 year(s) to repay. You can use cash or trade in a vehicle to use as a deposit.

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