Car Finance Australia — Compare New & Used Car Loans 2026
Guide to Australian car loans: secured vs unsecured, dealer finance vs bank loans, personalised rates, fees and balloon-payment risks.
Car Loan Options in Australia
Secured Car Loans
The car serves as collateral. If you default, the lender can repossess the vehicle.
- Rates: Usually lower than an equivalent unsecured loan, but the actual rate is personalised
- Terms: 1 to 7 years
- Best for: New and near-new cars, borrowers with good credit
Unsecured Car Loans
No collateral required, but higher rates.
- Rates: Often higher than secured-car rates; compare the rate and comparison rate for the same amount and term
- Terms: 1 to 5 years
- Best for: Older cars (5+ years), borrowers who don’t want the car tied to the loan
Dealer Finance vs Bank Loans
- Convenience · Dealer Finance：One-stop shop at dealership · Bank/Online Lender：Separate application
- Rate · Dealer Finance：May include dealership, introducer or broker fees · Bank/Online Lender：May avoid some dealer-arranged fees
- Approval speed · Dealer Finance：Varies by dealer and lender · Bank/Online Lender：Varies by lender and application
- Flexibility · Dealer Finance：Limited to dealer’s lenders · Bank/Online Lender：Compare multiple lenders
- Promotions · Dealer Finance：0% or low-rate deals (check fine print) · Bank/Online Lender：Rare promotions
Published Rate Examples (checked July 2026)
These are lender examples, not a whole-market range or a quote:
- Westpac petrol, diesel or LPG car loan · 6.49%–12.99% p.a.; comparison rate 7.90%–14.34% p.a.
- Westpac electric-car loan · 5.74%–8.49% p.a.; comparison rate 7.16%–9.88% p.a.
- CommBank secured fixed-rate car loan · 6.49%–10.49% p.a.; comparison rate 7.90%–11.86% p.a.
Sources: Westpac car-loan comparison and CommBank personal-loan calculator, checked July 2026. Rates and offers can change; obtain a personalised quote before deciding.
Balloon Payments
Some car loans offer a balloon payment — a large lump sum at the end of the loan that reduces monthly payments.
Example: $30,000 car loan, 5 years, 30% balloon:
- Regular payments are set so that $9,000 remains at the end; this is not the same as borrowing only $21,000
- $9,000 balloon due at the end of year 5
- You’ll need to refinance, pay cash, or sell the car to cover the balloon
Interest is charged under the contract while the balloon remains outstanding. A balloon lowers regular repayments but generally increases the total loan cost. Source: Moneysmart car loans, checked July 2026.
Key Checks Before Signing
- Is the rate fixed for the full term?
- Are there early repayment fees?
- Can you make extra repayments?
- Is there a balloon payment you haven’t noticed?
- Does the loan include optional insurance or add-ons that increase the total cost?