Car Loans Australia - Compare Rates from 50+ Lenders

Secured car loan rates through Emu Money's lender panel start from 5.67%, with most borrowers landing between 6.5% and 9.5% depending on their credit profile, the vehicle's age, and their loan term.

New cars attract the sharpest rates because they hold more value as security. A borrower with a clean credit history financing a new vehicle over 5 years can expect rates between 5.67% and 7.5%.

Used cars under 5 years old sit slightly higher, typically 6.5% to 8.5%. Once a vehicle passes 7-10 years old, rates climb further and some lenders won't finance it at all. Most lenders require the car to be no older than 12-15 years at the end of the loan term.

Unsecured rates start from around 8% and can reach 15%+ for applicants with credit impairments. The rate gap between secured and unsecured narrows on smaller loan amounts (under $10,000) where the total interest difference may not justify the PPSR registration.

Your credit history is the single biggest factor in the rate you're offered. A clean file with no missed payments or defaults in the past 12 months puts you in the strongest position.

Used car loans are more common than new in Australia. The average used car loan sits at $28,658 compared to $46,055 for new vehicles (ABS, Lending Indicators). Both are available through Emu Money's lender panel from $5,000 to $200,000.

New car loans offer the lowest rates (from 5.67%), longer available terms, and the widest choice of lenders. Depreciation is the downside: a new car typically loses around 20% of its value in the first year. On a 5-year loan with no deposit, you may be in negative equity for the first 18-24 months.

Used car loans mean a lower purchase price and less depreciation hit, but rates are higher and lenders impose age limits. Most require the vehicle to be under 12-15 years old at the end of the loan term. A 10-year-old car on a 5-year loan may not qualify with some lenders.

The sweet spot for value is a car that's 1-3 years old. The steepest depreciation has passed, rates are still competitive, and the vehicle has years of useful life ahead.

For more on how deposits affect the equation, see No deposit car finance: How it works.

On a $25,000 loan over five years, the difference between a secured rate of 7.5% and an unsecured rate of 11% is roughly $3,100 in total interest. Secured loans are cheaper because the lender holds security over the vehicle.

With a secured car loan, the lender registers a security interest on the PPSR against the vehicle's VIN. You own and drive the car, but you can't sell it until the loan is paid or the security is released. If you default, the lender can repossess the vehicle after the required notice period.

With an unsecured car loan, the vehicle is yours outright from day one. You can sell it, trade it, or modify it without lender permission. The lender has no claim on the car if you default, but they can still pursue the debt through other means.

For loans under $10,000, the total interest difference shrinks to $800-$1,500. At that level, the freedom of unsecured finance may be worth the extra cost, particularly if you're buying an older vehicle that may not qualify for secured finance.

For the full comparison with worked examples, see Secured vs unsecured car loans: What's the difference?.

Most borrowers can finance $5,000 to $200,000 for a car through Emu Money's lender panel. Your borrowing capacity depends on your income, existing debts, living expenses, and the vehicle you're buying.

A useful starting point: keep your total car loan repayment under 15% of your gross monthly income. On a $60,000 salary, that typically means a car loan of $20,000 to $30,000 over five years.

Lenders use the Household Expenditure Measure (HEM) or your declared expenses (whichever is higher) to calculate how much you can afford to repay. Credit card limits, BNPL accounts, and existing loans all reduce your capacity, even if you're not using them. A $10,000 credit card limit can reduce your car loan capacity by $10,000-$15,000, regardless of your actual balance.

A deposit improves your position. Even $2,000-$5,000 reduces the amount financed, can unlock a lower rate tier, and shows the lender you can save. That said, no deposit car loans are available for borrowers with strong credit profiles.

For detailed borrowing estimates by salary, see How much can I borrow for a car loan?.

Yes, you can get a car loan with bad credit in Australia. Specialist non-bank lenders on Emu Money's panel assess your current situation, not just your credit score. Expect higher rates of 10-25% depending on the severity and age of your credit issues.

The cost difference is real. On a $25,000 secured loan over five years, a borrower with excellent credit might pay $5,000 in total interest. A borrower with recent defaults could pay $10,000-$16,000 in total interest on the same loan amount.

What matters most to specialist lenders: the age and type of your credit issues (a $300 telco default reads differently to a $15,000 personal loan default), how many recent credit enquiries you have, and whether your current income can comfortably cover the repayments.

Time is your strongest lever. Most specialist lenders use internal tiers: 0-12 months since default is the hardest band, 12-24 months opens more options, and beyond 24 months rates drop meaningfully. If you can wait, it may save you thousands.

For strategies on strengthening your application, see Car loans with bad credit in Australia.

A secured car loan is almost always cheaper than an unsecured personal loan for buying a vehicle. On a $25,000 purchase over five years, the interest difference can be $3,000 or more in favour of the car loan.

The reason is simple: a car loan uses the vehicle as security, which lowers the lender's risk and your rate. A personal loan is unsecured, so the rate is higher to compensate.

A personal loan makes more sense when you're buying an older vehicle that doesn't qualify for secured finance (typically over 10-12 years old), buying privately and you want the flexibility to own the car outright from day one, or borrowing a smaller amount where the total interest difference is minimal.

Keep in mind that secured car loans typically offer higher borrowing limits (up to $200,000) compared to unsecured personal loans (usually capping at $50,000-$75,000). If you're financing a newer vehicle over $30,000, a secured car loan is the clear choice.

For a detailed cost comparison with worked examples, see Car loan vs personal loan: Which is better?.

Your rate is determined by four factors you can influence: your credit profile, the vehicle's age, your loan-to-value ratio (LVR), and whether you use a broker or go direct.

Clean up your credit file before applying. Check your report for free and dispute any errors. Clear small outstanding debts. A single unpaid $200 default can shift your rate tier.

Put down a deposit. At 80% LVR or below, most lenders offer their best rate tier. Even $2,000-$5,000 can make a difference on a $20,000-$30,000 purchase.

Choose a newer vehicle. Cars under 3 years old attract the sharpest rates. Once a vehicle passes 7 years, rates increase noticeably and options narrow.

Compare through a broker, not a dealer. On a $20,000 loan over five years, the difference between a dealer rate of 11% and a broker rate of 7.5% is roughly $3,800 in total interest. Dealers add margin to the rate, while brokers like Emu Money compare across 50+ lenders to find the lowest available rate for your profile.

Apply once, not five times. Multiple credit enquiries in a short period can lower your score and signal desperation to lenders. One application through a broker searches multiple lenders with a single credit pull.