If you're buying a car and you're on a tight deadline, you dont have time to go to the bank and wait 2 weeks for a loan approval. Quick, online car loans use digital technology to process your application fast and get funds to you when you need them most.
*You need to be an existing customer and apply in-store
A quicker car loan approval starts with the borrower
Some lenders have set up their entire car loan application process to be as quick as possible. And some haven't. But ultimately a well-organised borrower with an Excellent credit score will have an easier time getting a quick car loan approval.
Improve your chances of a fast car loan approval by:
Getting all your financial, car and ID details together.
Comparing car loans and making sure that you're applying for a suitable loan you'll actually get approved for.
Not trying to borrow more than you can comfortably repay.
Want a quick car loan? Try pre-approval
Some car lenders offer pre-approval or conditional approval before you actually apply for a loan.
With pre-approval you basically submit all the same information as with a full application. The lender will then give you "conditional" approval for a maximum loan amount.
While pre-approval is not a guarantee you'll get the loan approved, it gives you a good idea of how much you can probably borrow. It makes the actual application easier and faster because the lender already has most of your details.
What types of cars can I purchase with a quick car loan?
You can use a quick car loan for a range of cars:
New cars and newer used cars. Lenders will generally offer you a secured car loan for new and newer used cars. These car loans typically have lower interests rates as the loan is secured by the value of your vehicle.
Older used cars. For a car more than 10 years old or worth less than $10,000, you may need to opt for an unsecured car loan or standard personal loan. As the loan is unsecured there will be a higher interest rate charged.
Vintage cars. Older cars that have value due to being considered vintage may be eligible for a secured car loan, or secured line of credit, which will come with a lower interest rate.
Work vehicles. If the car is purchased primarily for business purposes you may be able to use a chattel mortgage. It works in a similar way to a home mortgage, where the lender has a mortgage for your vehicle and you make monthly payments towards it. Once it is fully paid you own the car outright.
How can I compare my options?
Quick car loans have the standard range of features that most personal finance products come with. However, not all lenders offer all features, so consider which ones are important to you or will give you the most cost-effective loan.
Look for a lower interest rate. If you get a lower interest rate you'll pay less in interest. This makes the loan cheaper.
Additional repayments. Being able to make regular or lump sum additional repayments helps you reduce your loan and save on interest charges. Some loans offer this option fee-free.
Fees. Car loans typically have two types of fees: an application fee and a monthly fee. Some loans charge neither but have slightly higher interest rates. Do the maths to work out the total cost of a loan before signing up.
Loan terms. Terms generally range from between one and seven years depending on the lender. Make sure you consider the ability to make additional repayments or pay the loan out sooner.
Vehicle age. For secured loans, lenders generally require the car to be new or a fairly new used car. Some will give a secured loan for vehicles that will be no more than 10 years old at the end of the loan term. It would be possible to purchase an eight-year-old car with a two-year loan term and get the benefit of a low interest rate with a secured car loan.
Things to avoid with quick car loans
Taking on too much debt. Don’t get pre-approval for the maximum amount the bank will give you. Work out the price range of cars you are actually interested in then add a bit extra as a margin of safety. If you get pre-approval for your maximum amount you may be tempted to spend more, or bargain less.
Applying for multiple loans. Just because these loans are quick and easy doesn’t mean you should apply without due consideration and reason. Too many credit applications can have a negative effect on your future borrowing potential.
Acting too fast. Taking out a loan, or even buying a car, should be a measured and considered decision and not be done on an impulse. Always take the time to think about the ramifications and future costs before committing to a loan.
Not working out the full cost. Don’t be fooled by low rates or fees. Calculate the total cost of a loan before comparing it with other options. Loans that have higher fees but with even a slightly lower interest rate can work out cheaper in the long run. Conversely, a no-fee loan with a higher interest rate might not actually be cheaper.
Have more questions?
Not necessarily, although it will make finalising the process faster later on. Getting a pre-approval is a fairly straightforward process, but only do it if you truly intend to take out a loan. Read more about pre-approval here.
No, not if you are organised. There are many loans that can be approved and funded quickly. If you at least spend a bit of time comparing a few options and calculating the total cost of each loan, you should be able to get a competitive deal.
Sometimes your own bank can approve small loans very quickly. Your bank knows a lot about you and can spend less time processing an application. Having all your finances in one place is very convenient too.
However, the other quick car loans listed above can be funded in under a day, so if you have reliable income and few other debts it won’t take long to get approval from a new institution.
No. Quick loans are identical in nature to any other regular personal loan. If you borrow from a licensed and authorised credit provider then both you and the lender are bound by the same rules and regulations as any other personal loan.
Elizabeth Barry is the lead editor for Finder. She has over 10 years' experience writing about a range of topics with a focus on personal finance. You’ll find her writing and commentary in a range of publications and media including Seven News, the ABC, MSN, the Irish Times and Singapore Business Review.
Want to buy a classic car but don't have the ready money? There are still financing options available for classic vehicles. Find out what loans you have to choose one and which one will work best for you.
Have bad credit but still need a car? There are a range of lenders that will consider you for a loan. Find out how to apply and how you can get approved in this guide.
Finding the right car loan shouldn't be as hard as finding the right car. Get a loan that will give you pre-approval so you can go shopping with the right amount of funds.
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