buying a new car

Best new cars under $20,000

Why pay more than you need to for a new car?

There are a number of benefits to buying a brand new car, but the price tag is not generally one of them. If you're looking for a new car but your budget is $20,000 or less, the options are somewhat limited. However, there is still a range of vehicles available at this pricepoint, and we've put together a comparison to help with your decision-making.

This guide takes you through the options you have for a budget of $20,000 or less, and offers advice on which features to look for, as well as a few ways to save some dollars on your purchase.

Which are the best new cars under $20,000?

ManufacturerModelPriceReview
FordFiestaFrom $15,825
HoldenSparkFrom $13,990
HoldenBarinaFrom $14,990
HondaJazzFrom $14,990
HondaCityFrom $15,990
HyundaiAccentFrom $15,490
Hyundaii30From $19,990Read Review
KiaPicantoFrom $14,190
KiaCeratoFrom $19,990
MazdaMazda2From $14,990Read Review
MitsubishiMirageFrom $13,490
RenaultCLIOFrom $16,490
SuzukiSwiftFrom $15,990Read Review
SuzukiBalenoFrom $15,990
SuzukiIGNISFrom $15,990
ToyotaYarisFrom $15,390
VolkswagenPoloFrom $17,990Read Review

What features should I look for in a new car under $20,000?

When you're buying a car on a budget it's important to know which features you want from the outset. Here are some items to look out for when you head to the dealership:

  • A 5-star ANCAP rating. Make sure the vehicle you're purchasing is rated highly by Australia's vehicle safety rating agency, ANCAP. Find out more about these ratings here.
  • Parking sensors or a reverse camera. Many new vehicles now come standard with either or both of these very convenient items, which assist you with reverse parking. Make sure you try them out during your test drive.
  • Bluetooth. Check the car is compatible for linking with your model of phone. For example, some vehicles are only set up for iPhones to fully use the system.
  • Blind-spot warning. This handy safety feature alerts you to vehicles that are in your blind spot.
  • Navigation system. Another great feature to have in your car. Make sure you ask how often the system is updated and which map system it runs through.

How can I save at a dealership?

If you've got your eye on a vehicle that's a little over your budget and are looking to shave off a few dollars, here are a few tips:

  • Stick to the rule of three. Visit at least three dealerships before making your purchase. That way, you'll be able to play the dealerships' offers against each other and have leverage when negotiating.
  • Get the timing right. There are a few schools of thought here. One is that you should visit at the end of the month when dealerships are trying to hit their sales targets. Another is that you should visit on a Monday or Tuesday when dealerships are less busy and there's more time to negotiate. One well-known time to snap up a bargain is the at end of financial year sales, as dealerships offer specials in order to hit their EOFY goals. A final idea around timing is to wait until a dealership is having a model runout, when the current model of a vehicle is about to be replaced by an updated version. Dealerships try to clear out the older design to make way for the new build and may be more willing to strike a bargain.
  • Avoid unnecessary add-ons. A report from the Australian Securities and Investment Commission (ASIC) found that many insurance plans sold by car dealers weren't valuable to consumers, so be careful what you sign up for. Types of insurance to question if they are offered include tyre insurance, loan protection insurance and even add-ons such as rust-proofing.

Car loans you can use to purchase a vehicle under $20k

Rates last updated April 19th, 2019
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Application Fee Monthly Service Fee Product Description Monthly Repayment
Latitude New and Used Car Loan
From 6.99% (fixed)
8.1%
$5,000
1 to 7 years
$295
$10
You'll receive a fixed rate between 6.99% p.a. and 14.99% p.a. based on your risk profile
Apply for a loan from $5,000 to finance a new or used car. Flexible repayments and options to finance a classic car.
IMB New Car Loan
5.89% (fixed)
6.24%
$2,000
1 to 7 years
$250
$0
You'll receive a fixed rate of 5.89% p.a.
A low minimum borrowing amount of $2,000 that you can use to purchase a new car or one up to two years old.
Beyond Bank Low Rate Car Loan
From 5.69% (fixed)
5.97%
$25,000
1 to 7 years
$175
$0
You'll receive a fixed rate of 5.69% p.a.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.
Loans.com.au - New Car Loan
5.44% (fixed)
5.99%
$5,000
3 to 5 years
$400
$0
You'll receive a fixed rate of 5.44% p.a.
Finance a new car and benefit from features such as fast approval, no ongoing fees and an optional balloon payment.
Stratton Finance New Car Loan
From 5.34% (fixed)
6.6%
$7,500
1 to 7 years
$459.20 (for private seller vehicles this fee is $608)
$8.90
You'll receive a fixed or variable rate depending on the lender you are approved with
Apply for up to $150,000 and use cash or trade in a vehicle to use as a deposit. Optional balloon payment available.
RACV New Car Loans
From 5.99% (fixed)
6.55%
$15,000
1 to 7 years
$399
$0
You'll receive a fixed rate of 5.99% p.a.
A larger loan of $15,000 or more to help you buy a new or used car. 5-hour pre approval available and no ongoing fees. Note: Product only available to residents of Victoria.
Credit Concierge Car Loan
From 4.99% (fixed)
6.23%
$10,000
1 to 7 years
$350
$5
You'll receive a interest rate from 4.99% p.a. with a comparison rate from 6.23% p.a.
Get access to over 20 providers to fund a new or used car.
Westpac Car Loan
From 8.49% (fixed)
9.67%
$10,000
1 to 7 years
$250
$12
You'll receive a fixed rate of 8.49% p.a.
Finance a new or used car and benefit from convenient features for car buyers including a car search tool and the option to borrow extra for on-road costs.
St.George Secured Personal Loan - Fixed Rate
From 8.49% (fixed)
9.6%
$3,000
1 to 5 years
$195
$12
You'll receive a fixed rate from 8.49% p.a. based on the value of your car
Get a competitive rate and apply for a larger loan up to $80,000 when you attach a new or used car as security to the loan.
IMB Secured Personal Loan
6.89% (fixed)
7.24%
$2,000
1 to 5 years
$250
$0
You'll receive a fixed rate of 6.89% p.a.
Benefit from this competitive rate by securing the loan with a vehicle up to 6 years old. Use this flexible loan for any purpose.

Compare up to 4 providers

Prices are for base models. Prices from redbook.com.au and accurate as at time of publishing.

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Car Loan Offers

Important Information*
IMB New Car Loan

You'll receive a fixed rate of 5.89% p.a.
A low minimum borrowing amount of $2,000 that you can use to purchase a new car or one up to two years old.

Latitude New and Used Car Loan

You'll receive a fixed rate between 6.99% p.a. and 14.99% p.a. based on your risk profile
Apply for a loan from $5,000 to finance a new or used car. Flexible repayments and options to finance a classic car.

Beyond Bank Low Rate Car Loan "Special Offer"

You'll receive a fixed rate of 5.69% p.a.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.

Loans.com.au - New Car Loan

You'll receive a fixed rate of 5.44% p.a.
Finance a new car and benefit from features such as fast approval, no ongoing fees and an optional balloon payment.

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