personal-car-finance

Personal Car Finance

Here is how you can use personal car finance to help afford the car you want.

Australians today have a wide range of personal car finance options that offer flexible financing, enabling them to afford a car. The choice of personal car finance option that you opt for depends on many factors, including what you intend to use the car for, whether your employer offers you a salary package and the car you’re interested in buying. There are numerous products to choose from such as hire purchase, car loans and novate leasing. The method you choose should be determined by your personal needs.
Whether you are planning to finance a new or used car, the many choices available to you can be confusing. Our guide is meant to help you find a good deal that will allow you to own a car without straining yourself financially.

Car Loan Offer

CUA Fixed Rate Car Loan

from

6.79 % p.a.

fixed rate

from

6.92 % p.a.

comparison rate

  • No monthly fees
  • No early repayment fees
  • Flexible repayment options
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100% confidential application

Car Loan Offer

Apply for a CUA Fixed Rate Car Loan and enjoy a great low interest rate with no ongoing fee.

  • Interest rate from: 6.79% p.a.
  • Comparison rate: 6.92% p.a.
  • Interest rate type: Fixed
  • Application fee: $0
  • Minimum loan amount: $15,000
  • Maximum loan amount: $100,000
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Car loan comparison

$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Application Fee Monthly Repayment Product Description
CUA Fixed Rate Car Loan
From 6.79% (fixed)
6.92%
$15,000
1 to 7 years
$0
A competitive car loan that offers flexible repayment options and no account keeping fees.
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
RACV Car Loans
From 7.49% (fixed)
8.03%
$15,000
1 to 7 years
$378
Enjoy this fixed rate new car loan offer from RACV. No ongoing fees.
Bank Australia Car Loan
From 6.45% (fixed)
6.66%
7 years
$150
A competitive rate and the ability to offset your car’s carbon emissions for the loan term.
MyState Secured Personal Loan
From 7.99% (variable)
8.96%
$10,000
1 to 10 years
$200
Apply for a loan up to $75,000 and use the funds for any purpose.
NRMA New Car Loan
From 7.49% (fixed)
8.03%
$15,000
1 to 7 years
$378
Purchase a new car with an NRMA Car Loan with a fixed rate term and no monthly fees. NRMA Members could save 1% on loan rates.
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.
St.George Secured Personal Loan - Fixed Rate
From 8.49% (fixed)
9.39%
$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.
Bank of Melbourne Secured Car Loan
From 8.49% (fixed)
9.39%
$3,000
1 to 5 years
$195
A low rate personal loan from Bank of Melbourne with variable or fixed option.
BankSA Fixed Rate Car Loan
From 8.49% (fixed)
9.39%
$3,000
1 to 5 years
$195
Apply for a fixed rate car loan from multi-award winning BankSA.

Compare up to 4 providers

How does personal car finance work?

Personal car financing is a viable option for individuals who want to purchase a car for personal use. With rising vehicle costs, most Australians cannot afford to make cash payments for car purchases, which leaves them with either leasing, hire purchase or getting a car loan.

This type of finance can include any arrangement that enables you to acquire a car without having to make a one-off lump sum payment. You can opt for dealer finance or a car loan, whichever you think is the best deal for you. The funding for personal car finance is usually provided by special car financing companies or retail banks. The financier may retain ownership of the car until all payments are made.

How to compare car financing options

Personal car finance provides several options, whose suitability depends on your personal needs. Here is a look at the main options available to you and what they entail:

  • Personal loan.
    Under this method, you get a car loan from a finance provider like a bank or building society. This method is usually the cheapest in financing a car purchase, though it will require you to have a good credit history along with other criteria.
  • Car loan.
    A form of a personal loan, here a lender, say a bank or building society, will give you the funds you need to buy a car, and require that you commit to making monthly repayments for a certain fixed period. The lender uses the vehicle as security for the loan but you get to assume ownership of the vehicle immediately. There are some specifications as to what type of car you can have to use a security as a loan, so make sure you check the fine print.
  • Commercial hire purchase.
    Here, a financier agrees to purchase a car on your behalf and then leases it back to you over a certain contract period. You do not get full ownership of the car over the lease term until you finally make all the repayments.
  • Novated Lease (salary packaging).
    This is an agreement between an employee, employer and a financier such as a bank. The employee gets into a car lease deal with the financier, where the employer agrees to take all the obligations of making repayments on the behalf of the employee.

Pros and cons of personal car finance

Pros

  • Wide range of options. With personal car finance, there are many different options, each suited to different customer needs. You can choose between a car loan, hire purchase, a car lease and salary packaging.
  • Flexible payments. Instead of making a lump sum payment when purchasing a car, personal car finance gives you the chance to make small, convenient monthly payments that will not strain you financially. With car prices on the rise in Australia, this makes personal car finance lucrative to many who are unable to save enough to buy a car. Repayment amounts can be negotiated with lenders in advance, ensuring that they are affordable.
  • Many options for funding. You could get the funding for a car from retail banks, car manufacturers with their own financing arms or even from specialist car financing companies.

Cons

  • Know what you’re looking for. Making the wrong choice when it comes to your personal car finance option can end up costing you thousands in extra interest, penalties and other fees.

Things to be wary of before applying for car finance

If you are planning on comparing personal car finance options, you should always make sure to factor in the total cost of borrowing including all charges, fees and insurance payments.

It is also important to ensure you can afford the monthly repayments and enquire whether there are any upfront payments or penalties for late repayments. Use our calculator to help you figure out that your repayments will be.

If you have a good credit history, you may want to go for a personal loan to finance your car purchase. However, using your home to secure the loan could be risky if you fail to make the required repayments. If your income is very low, it is better to stay out of debt altogether because all repayments on your personal car finance could take a toll on your income.

Find out more: Personal Loan Calculators

How to apply

At finder.com.au, we help you compare various personal car finance options so that you get a deal that suits you. Use our comparison table to check out the deals available from our featured lenders and click the 'Go to site' button that you would like to get a quote on. You will be required to enter your personal details such as your address, name and phone number along with your financial details such as your gross salary and current employer when getting a quote for a car loan, hire purchase deal or novate lease.

Picture: Shutterstock

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Related Posts

CUA Fixed Rate Car Loan

A competitive car loan that offers flexible repayment options and no account keeping fees.

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.

RACV Car Loans

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

NRMA New Car Loan

Purchase a new car with an NRMA Car Loan with a fixed rate term and no monthly fees. NRMA Members could save 1% on loan rates.

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