How to Get a Car Loan in Australia: A Step-by-Step Guide
The fastest way to work out how to get a car loan is to compare multiple lenders at once rather than applying to one bank and hoping for the best. Most Australians qualify for some form of car finance, the real question is which lender offers the best rate for your circumstances.
Here is the process broken down, including options for buyers with a less-than-perfect credit history.
Step 1: Know Your Budget and Loan Amount
Work out how much you need to borrow after any deposit or trade-in, and what monthly repayment fits comfortably within your budget. Lenders will also assess this as part of responsible lending obligations.
Step 2: Check Your Credit File
Your credit history influences the rate you are offered. You can request a free copy of your credit report from providers such as Equifax or illion before you apply, so there are no surprises.
How to Get a Car Loan With Bad Credit
A lower credit score does not mean you are locked out of car finance. Specialist lenders in the Compare Solutions panel cater specifically to borrowers with past defaults, short credit histories, or inconsistent income.
- Consider a secured car loan, where the vehicle acts as collateral and often attracts a lower rate
- Provide evidence of stable income, even if your credit file has blemishes
- A larger deposit can improve the rate a lender is willing to offer
- Avoid multiple hard credit applications in a short period, as this can further lower your score
Step 3: Compare Lenders Instead of Applying One by One
This is where most buyers get it wrong. Applying directly to several lenders can each leave a mark on your credit file. Comparing quotes side by side, without that impact, is how to get a car loan efficiently and protect your credit score at the same time.
Step 4: Submit Your Application
Once you have chosen the best offer, most lenders require proof of identity, income, and expenses. A fully online process means no paperwork and no branch visits, with approval often possible within the same day.
How long does approval usually take?
Many online lenders offer conditional approval within hours once your documents are verified, with formal approval often completed within a business day for straightforward applications.
Do I need a deposit to get a car loan?
Not always. Many lenders offer 100% finance, though a deposit typically improves the rate offered and reduces your monthly repayments over the loan term.
Can I get a car loan while between jobs?
It is harder, but not impossible. Lenders generally want to see stable income, so a new job offer, other income sources, or a guarantor can help support an application in this situation.
Does the type of vehicle affect approval?
Yes, the vehicle's age, condition and value are assessed alongside your finances, since it typically acts as security for the loan and needs to meet the lender's eligibility criteria.