Secured Car Loans

purchase car loanUse your car as security and benefit from lower interest rates.

Have you been thinking about financing a new car but are concerned about the cost? Whether you're purchasing a new or used vehicle, you still may be able to use it as a guarantee to take advantage of a low interest rate. Find out what you need to know about secured car loans in this guide.

IMB Car Loan Offer

IMB New Car Loan

from

5.99 % p.a.

fixed rate

from

6.34 % p.a.

comparison rate

  • No monthly fees
  • No early repayment fees
  • Borrow up to $75,000
Security Logo

100% confidential application

IMB Car Loan Offer

Apply for IMB New Car Loan and enjoy a great low fixed interest rate with no ongoing fees.

  • Interest rate from: 5.99% p.a.
  • Comparison rate: 6.34% p.a.
  • Interest rate type: Fixed
  • Application fee: $250
  • Minimum loan amount: $2,000
  • Maximum loan amount: $75,000
Go to site

Here are some secured car loans you could apply for

Rates last updated August 17th, 2017
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Application Fee Monthly Repayment Product Description
IMB New Car Loan
From 5.99% (fixed)
6.34%
$2,000
1 to 7 years
$250
This fixed rate new car loans up to 2 years old features no early repayment penalties
AutoCarLoans
From 5.16% (fixed)
6.64%
$15,000
1 to 7 years
$381.80
AutoCarLoans can match you with a lender on their panel with rates starting from 5.16% p.a.
RACV New Car Loans
From 6.99% (fixed)
7.54%
$15,000
1 to 7 years
$380
Enjoy this fixed rate new car loan offer from RACV. No ongoing fees.
IMB Secured Personal Loan
From 7.39% (fixed)
7.74%
$2,000
1 to 5 years
$250
A secured loan from IMB with flexible repayment features
Latitude Personal Loan (Secured)
From 12.99% (fixed)
14.2%
$3,000
2 to 7 years
$250 (Loans under $4000 - $140)
Can be used for whatever purpose: renovating, buying a car, booking a holiday. Funds can be in your account in as little as 24 hours.
Westpac Car Loan
From 8.49% (fixed)
9.67%
$10,000
1 to 7 years
$250
Apply for a Westpac car loan and enjoy a great interest rate when you purchase a new or used vehicle.
St.George Secured Personal Loan - Fixed Rate
From 8.49% (fixed)
9.6%
$3,000
1 to 5 years
$195
Get behind the wheel of your perfect car with a competitive interest rate from St.George. Get an application response within 60 seconds.

Compare up to 4 providers

More secured car loan comparisons

Need more information? Check out the secured car loan details in the table below.

Secured Car LoanFeature
Get a secured car loan with interest rates from 10.99% p.a.
A a competitive fixed rate loan that offers rates from 10.99% p.a. and flexible features.
A secured car loan for your next car from the Royal Automotive Club of Victoria
This award winning bank offers a secured car loan with rates from 8.49% p.a.

How does a secured car loan work?

A secured car loan is a way to finance a vehicle purchase where your car is used as security. The vehicle you're purchasing needs to be in good condition so lenders usually require the vehicle to be new, but you can find secured car loans for used vehicles. You can also use some secured car loans to refinance an existing secured loan from another bank.

Secured loans can offer you a lower rate of interest because the lender has less of a risk. If you default on the loan the car you've purchased will be repossessed by the lender. Secured car loans offer low interest rates that can be fixed or variable.

How do secured car loans differ to unsecured loans?

There are several key differences between these two types of loans:

  • Loan amount flexibility. With a secured loan, you are restricted as to how you can use your funds, for example, you may not be able to borrow to cover rego, insurance or other costs. This is because the loan amount is tied to the cost of the vehicle. Unsecured loans have no such restrictions and you can use the loan amount however you choose.
  • Vehicle requirements. Lenders offering secured car loans will have guidelines as to what vehicle you can purchase. This may be that the car needs to be below a certain age or that you cannot purchase certain types of cars. If you opt for an unsecured loan you can purchase whatever type of car you like.
  • Interest rates. Rates for secured car loans are much more competitive than unsecured loans.
  • What happens if you default. When you default on a secured car loan the lender is able to sell the vehicle to recoup its losses. If you default on an unsecured loan the lender has no right to your vehicle.

How you can compare the different secured car loans available

There is a range of secured car loans available from a number of different lenders. Finding the best secured car loan for you will depend on things like your financial situation and the length of the loan you require, but there are some other factors which you can use to determine the quality of the loan.

  • Interest rate and comparison rate

The rate of a loan determines what your repayments will be and differs greatly between lenders. Comparison rates incorporate the total cost of the loan so be sure to compare this before you apply.

  • Fees

These can include establishment fees upon accepting your loan and ongoing fees such as loan service fees. Compare fees in addition to the interest rate and loan features to make sure you're getting a good deal.

  • Loan term

Lenders set specific loan terms (usually between one and five for fixed rate loans and one and seven years for variable rate loans) that you can select from. Make sure your lender lets you repay the loan in a period that is suitable to your budget.

  • Minimum and maximum loan amount

A typical minimum loan amount is $5,000 while the maximum amount varies greatly between lenders. Some lenders don't have a maximum borrowing amount and keep this as a case-to-case determinant. Keep this in mind depending on what car you're going to buy.

  • Additional repayments

Some lenders offer the ability to make additional repayments to pay your loan off sooner. If you think you'll be able to put more money towards your loan then ensure you include this feature in your comparison. Keep in mind that some lenders will charge fees if the loan is paid out earlier than expected, so if you think you'll be able to do this then seek a loan without these penalties.

  • Other features

Loans come with various features to help you manage it better. Some lenders offer discounted insurance products with the loan and others offer vehicle finding services.

The benefits and drawbacks you should consider

  • Competitive interest rate. Secured loans come with lower interest rates than unsecured loans, helping to keep your repayments manageable.
  • The vehicle doesn't have to be brand new. Some lenders let you use a used vehicle as a guarantee for a loan, and cars up to 12 years of age or older can be eligible.
  • Restricted loan amount. As the loan is secured you will generally only be able to use the loan amount to purchase the vehicle (and not for unrelated costs). You may find some lenders willing to extend this loan amount to purchase car insurance or something similar.
  • Risking your vehicle. Although using your car as security lowers your repayments, it also means that if you default on your loan you will lose your car. Make sure you only take on a loan you can afford and keep on top of your repayments.

Is there anything to avoid with secured car loans?

  • Over-estimating your repayments.

Although using your new car as security has its benefits, it also means the lender can take it away if you default on your loan. Be sure to only take out loans that are manageable with repayments you will be able to meet.

  • Not being aware of fees.

If you do not familiarise yourself with the fees associated with a secured car loan from a particular lender, you may end up paying more than you thought you would. Some lenders have lower fixed interest rates, but then have monthly fees which mean you end up paying more anyway. Be aware of all aspects of your loan.

  • Not choosing a loan that meets your needs.

It's really common for people to choose a loan that they regret in a few years time. You could be paying off this loan for a while, so make sure you take into account possible changes in your financial circumstances. You may receive a promotion and want to increase your repayments to pay off your loan sooner, but your lender may not allow that. Make sure you check all the limits of the loan and how flexible it is.

Questions we are frequently asked about secured car loans

How do I apply for a secured car loan?
Applying for a secured car loan differs between lenders. Many lenders will let you apply online, with some processing your application and sending a response within minutes. You can also apply over the phone or by visiting lenders who have branches. For details on specific lenders, have a look at their websites.

What is the length of a secured car loan?
This differs between lenders, but an average option is from between one and seven years. If the interest rate is fixed the loan term may only be offered up to five years.

What are the minimum and maximum loan amounts for secured car loans?
The loan amounts differ between lenders, with some offering loans for as low as $1,000 and maximums reaching as much as $100,000. Some lenders have no minimum or maximum amount.

What other finance options are there for car loans?
There are several options for you to finance your car purchase. You can choose from a range of secured and unsecured personal loans, or secured and unsecured car loans. Some lenders also have general credit options and loans which may be suitable to your financial situation.

Where can I compare car and personal car loan options?
Comparing car loans can help you choose the best option to suit your needs, so remember to compare the options available.

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Related Posts

IMB New Car Loan

This fixed rate new car loans up to 2 years old features no early repayment penalties

Latitude Personal Loan (Secured)

Can be used for whatever purpose: renovating, buying a car, booking a holiday. Funds can be in your account in as little as 24 hours.

AutoCarLoans

AutoCarLoans can match you with a lender on their panel with rates starting from 5.16% p.a.

RACV New Car Loans

Enjoy this fixed rate new car loan offer from RACV. No ongoing fees.

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12 Responses

  1. Default Gravatar
    RaeleeneSeptember 18, 2016

    I want to pay out my existing bank loan of approx $23,000 and use my Ford Focus 2012 Hatch approx value $14,000 and my defacto Holden Commodore 2010 approx $16,000 as collateral is this possible

    • Staff
      ElizabethSeptember 20, 2016Staff

      Hi Raeleene,

      This might be possible with a secured personal loan. You can compare your options on this page, but make sure you contact the provider before you apply to make sure you’ll be able to use two vehicles as security.

      I hope this helps,

      Elizabeth

  2. Default Gravatar
    davemfwAugust 31, 2015

    In Australia, which financiers will lend funds on Grey imports?

    • Staff
      ElizabethAugust 31, 2015Staff

      Hi Davemfw,

      Thanks for your question.

      A few lenders on this page will consider you for a loan if you’re looking at financing a grey import car. For most, it depends on the specific circumstances, including your financial situation, where you’re importing the car from, what type of car it is, etc. It also depends how old the car is. It would be best to get in touch with the lender directly to discuss your loan options before applying.

      You can also take a look at this page to find out about importing a car and some forums to take a look at for car advice.

      Thanks,

      Elizabeth

  3. Default Gravatar
    ChrisJuly 1, 2015

    Hi there, I have a $14,000 motorcycle is there any chance I can use it for equity? My credit history is on the mend I’ve started paying everything off and they aren’t for very much money at all I just fell into the trap many years ago and now tidying it all up?! Can you recommend me to somebody that I may be able to get one through with small default against my credit rating any help would be fantastic. Thank you.

    • Staff
      ElizabethJuly 1, 2015Staff

      Hi Chris,

      Thanks for your question.

      I can’t recommend a specific lender to you but you can compare bad credit car loans on this page. You can take a look at the eligibility criteria, and when you’re ready to apply click ‘Go to Site’.

      I hope this has helped.

      Thanks,

      Elizabeth

  4. Default Gravatar
    DaleMay 13, 2015

    Are there loan products available for grey import cars? Would this be applicable under a car loan?

    • Staff
      ElizabethMay 14, 2015Staff

      Hi Dale,

      Thanks for your question.

      A few lenders on this page will consider you for a loan if you’re looking at financing a grey import car. For most, it depends on the specific circumstances, including your financial situation, where you’re importing the car from, what type of car it is, etc. It would be best to get in touch with the lender directly to discuss your loan options before applying.

      I hope this has helped.

      Thanks,

      Elizabeth

  5. Default Gravatar
    RianaApril 28, 2015

    What is the “repayment amount”?

    • Staff
      ElizabethApril 29, 2015Staff

      Hi Riana,

      Thanks for your question.

      The repayment amount is the amount you have to pay on your loan, which will be the original amount you borrow plus interest. This is either in periodic installments, say monthly, or the total amount you have to repay at the end of the loan term.

      I hope this has helped.

      Thanks,

      Elizabeth

  6. Default Gravatar
    sarahApril 17, 2015

    I own land to value of $140 000, can I secure it for car loan with casual employment with no bad credit.I want to buy near or new commodore and repay over 7 years

    • Staff
      ElizabethApril 21, 2015Staff

      Hi Sarah,

      Thanks for your question.

      Secured car loans work with the loan being secured to your newly purchased vehicle. However, some lenders may look more favourably on your application if you hold equity in your property. You can consider some of the lenders on this page for a bad credit car loan.

      I hope this has helped.

      Thanks,

      Elizabeth

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