Applying for more than one car loan at once?
Read this before you apply for any car finance.
We’re reader-supported and may be paid when you visit links to partner sites. We don’t compare all products in the market, but we’re working on it!
Shopping around for a car loan is always a good idea. However, this does not extend to actually applying for every loan offer you see. Every time you apply for a car loan that application is listed on your credit file and will affect your ability to be approved for credit in the future.
This guide will take you through when submitting your details does and does not mean you're applying for car finance and how to "shop around" without it affecting your credit score.
What's in this guide?
- When will shopping around for a car loan affect my credit rating?
- How many inquiries is too many?
- What happens if I don't get approved when I apply for a car loan?
- How do I check my credit file and credit score?
- Comparing car loans before applying
- Can I apply for a car loan if I have a bad credit history?
When will shopping around for a car loan affect my credit rating?
Technically, only submitting your personal and financial details as part of a loan application will result in a mark on your credit file. The credit provider will need details such as your name and driver's licence number to be able to bring up your credit file and then be able to list the inquiry.
However, it may not be obvious that an inquiry will be listed. For instance, the credit provider may advertise it as a "quote" or an "initial consultation" but even if you don't follow through with the loan, you could see it listed in your file as an inquiry. If you have multiple inquiries listed on your file in a short space of time this will affect your credit score.
How many inquiries is too many?
There is no one number that is "too many", but generally, one credit inquiry every three to six months is not considered to be risky behaviour by lenders and shouldn't affect your credit score too much.
What happens if I don't get approved when I apply for a car loan?
If you do your due diligence and shop around for the best rates, fees and features without applying but don't get approved, you may be wondering what to do now. If you don't need to purchase the car straight away you might consider waiting three months to apply with another lender. Even waiting a couple of weeks may make you look like less of a risk to a lender.
If you are in a position where you do need to make the car purchase quickly, consider calling the lender to explain your situation and finding out whether or not your recent rejection will be an issue. You can also consider finding finance with a car loan broker.
How do I check my credit file and credit score?
You can check your credit score for free on finder. You can also order your credit file for free every 12 months or if you've been rejected for credit in the past 90 days. Your free credit file will be delivered to you within 10 days. However, if you want it delivered sooner or aren't eligible for a free credit file, you can pay a fee for it as well.
Comparing car loans before applying
Applying for a car loan can be one of life's big decisions. You'll be paying off a depreciating asset for a period of time, so it is always important to compare your options. Use the comparison table below to get an idea of the interest rates, fees and charges, and loan terms before applying.
- 30-day pre-approval
- Fast turnaround
- Loan amounts from $2,000
100% confidential application
Plenti Car Loan
Get access to a car loan from $2,000 to $100,000 on terms of 3, 5 or 7 years. Rates are tailored to your loan term and securing the loan is optional.
- Interest rate: From 4.89% p.a.
- Comparison rate: From 5.44% p.a.
- Interest rate type: Fixed
- Application fee: $799
- Minimum loan amount: $2,000
- Maximum loan amount: $100,000
Can I apply for a car loan if I have a bad credit history?
If you have bad credit you can compare lenders that specifically work with bad credit applicants. Depending on how bad your credit history is, it may also be worth getting in touch with your current bank to see if it would be willing to consider your application. Make sure to contact your bank before submitting an application.
Before you begin your search, build up a small deposit and examine your budget to decide how much of a car loan monthly repayment you can afford. Then begin to research and compare the different lenders who specialise in high-risk car loans before making your final decision.
Don’t make further negative marks on your credit report by applying to more than one. Most of these types of lenders will analyse your credit rating without it showing up on your report to ensure that you will qualify before they process your application.
More guides on Finder
Non-conforming home loans guide
Imperfect credit? A non-conforming loan might help you become a home owner.
Toyota RAV4 car loans
Compare car loans and discover prices and specs of the Toyota RAV4.
Afterpay hangover? Beware of impact on home loan approval
Off the back of Christmas spending, a finance expert has warned that your Afterpay habits could negatively impact your home loan application.
UCapital Unsecured Business Loan
A UCapital unsecured business loan can provide up to $300,000 without security, with repayment terms between 3 and 12 months.
How to start an accounting business
Find out what you need to know before starting an accounting business.
When does your owner occupier loan become an investment loan?
Do you have to tell your lender if you rent out a room and turn your mortgage into an investment loan?
What is a credit score?
Find out what a credit score is and what it can do for you.
Financial Fitness Challenge Week 2: Check and improve your credit score
Understand your credit score with the Finder Financial Fitness Challenge.
Brighte Personal Loan
Looking to renovate your home? Find out more about Brighte's personal loan for home improvements and ways in which it may be able to benefit you.
Planning your retirement? Here are 4 things you need to know about reverse mortgages
SPONSORED: A reverse mortgage could let you use some of your home equity to fund your retirement costs. Here's what you need to know.
Car Loan OffersImportant Information*
You'll receive a fixed rate of 4.99% 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.
You'll receive a fixed rate of 4.69% p.a.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.
You'll receive a fixed rate from 4.99% p.a.
A larger loan of $5,000 or more to help you buy a new or used car. 5-hour pre approval available and no ongoing fees.
You'll receive a fixed rate of 4.99% p.a.
Purchase a new or used car up to 2 years old and benefit from a fixed rate and no monthly fees. Pre-approval available within 5 business hours.
Ask an Expert