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Compare Your Best Car Loan Rates
Updated 4 Jul 2025
Find your best car loan deal today, with free personalised quotes from top Australian lenders.
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Car Loan comparison guide created by our team of experts.
Cheapest car loan rates on our database
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Applying for a car loan
Money.com.au can help you find the best deal you can on a car loan in three simple steps:
Lowest car loan rates in July 2025
The lowest car loan rate available right now is 5.09% p.a. (comparison rate 5.78% p.a.) on RACV's Green Car Loan for eligible electric vehicles (EVs). For standard car loans (non-EVs), the lowest rate starts from 5.67% p.a. (comparison rate 6.10% p.a.) on MoneyPlace’s Secured Car Loan.
Below we've rounded up some of the lowest car loan rates from our database in different categories.
Best rates by category
Best standard car loan rates
| Loan | Interest rate starting from | Comparison rate starting from |
|---|---|---|
MoneyPlace Secured Car Loan | 5.67% p.a. | 6.10% p.a. |
Harmoney Unsecured Car Loan | 5.76% p.a. | 5.76% p.a. |
SWSCU Vehicle Loan | 5.79% p.a. | 5.79% p.a. |
Horizon Bank New Car Loan | 5.99% p.a. | 6.21% p.a. |
Greater Bank New Car Loan | 5.99% p.a. | 6.37% p.a. |
Lowest EV/green car loan rates
| Loan | Interest rate starting from | Comparison rate starting from |
|---|---|---|
RACV Green Car Loan | 5.09% p.a. | 5.78% p.a. |
CommBank Secured Personal Loan (EV Access Program) | 5.29% p.a. | 6.72% p.a. |
Bendigo Bank Secured Green Personal Loan | 5.49% p.a. | 5.84% p.a. |
People's Choice/Heritage Bank Green Car Loan | 5.69% p.a. | 6.04% p.a. |
Horizon Bank Green Car Loan | 5.79% p.a. | 6.01% p.a. |
Best fixed car loan rates
| Loan | Interest rate starting from | Comparison rate starting from |
|---|---|---|
MoneyPlace Secured Car Loan | 5.67% p.a. | 6.10% p.a. |
Harmoney Unsecured Car Loan | 5.76% p.a. | 5.76% p.a. |
Horizon Bank New Car Loan | 5.99% p.a. | 6.21% p.a. |
IMB Bank New Secured Fixed Car Loan | 5.99% p.a. | 6.34% p.a. |
Greater Bank New Car Loan | 5.99% p.a. | 6.37% p.a. |
Best variable car loan rates
| Loan | Interest rate starting from | Comparison rate starting from |
|---|---|---|
SWS Bank 5 Year Variable Interest Vehicle Loan | 5.79% p.a. | 5.79% p.a. |
Queensland Country Bank New Car Loan | 5.99% p.a. | 6.59% p.a. |
MONEYME Personal Loan | 5.99% p.a. | 6.70% p.a. |
Loans.com.au New/Demo Loan Variable | 5.99% p.a. | 7.12% p.a. |
Illawarra Credit Union Online Personal Loan | 6.00% p.a. | 6.64% p.a. |
Sean Callery, Editor of Money.com.au
"Don't be fooled by the super low 'headline' interest rates lenders often advertise. The rates most borrowers end up on will be higher than this, depending on their financial situation, the car being financed and where it's purchased. According to Money.com.au’s analysis of thousands of car loan requests, almost two-thirds (64.6%) of borrowers finance a used car, with around 28% of people buying privately. If you're not buying a new or almost-new car from a dealer, expect to pay a higher rate on your finance."
Sean Callery, Editor of Money.com.au
How to compare car loan rates: advertised versus actual rates
Car loan interest rates generally come in ranges. This is the same for other kinds of personal loans. Where your actual rate will sit within the lender's rate range will depend on your application.
The riskier your car loan application is, the higher the interest will be. This is why it's very important to take 'advertised rates' on car loans with a large pinch of salt. In fact, the Reserve Bank of Australia reports that the average fixed term personal loan rate (including car loans) is 9.68% p.a.
The key to getting your best car loan rate is comparing personalised quotes.
10 factors that determine your (actual) car loan interest rate
1. Your credit score
Borrowers with the highest (best) credit scores, generally qualify for the best car finance rates in Australia. Lenders like borrowers with a proven track record of managing credit responsibly, which is what your credit score is designed to show.
According to our database, most car loan applicants (47.05%) had an excellent credit score, while 22.67% had a great or very good score. The remaining applicants were split between good (13.32%), below average (9.58%) and average (7.37%).
If your credit score is below average, you may need to apply for a bad credit car loan. However, you'll likely be charged a higher interest rate, and the loan will generally come with more restrictive terms.
Tip: Avoid making multiple car loan applications in a short space of time as this can damage your credit score.
2. The age and type of car
There are a few key points here:
- The cheapest car loans in Australia are generally ones available for electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs).
- Around 40% of the lenders we analysed offer a discounted car loan interest rate for EVs.
- Lenders offer the lowest car loan interest rates on brand new cars or demo models.
- Some lenders have tiered interest rates for used car loans that increase based on the car's age (so not all used cars will attract the same rate).
- Other non-car vehicle types can be financed with what is effectively a car loan. But rates may vary for other vehicle types, such as caravan loans, boat loans, motorcycle loans and truck finance.
- Our database found that most vehicle loan applicants were in the market for a car (78.98%), followed by utes (11.55%), motorcycles (6.8%), vans (1.9%) and trucks (0.75%).
3. The car loan term
Some lenders charge higher interest rates on car loans with a longer term. Again this comes down to the greater risk for the lender when lending over a longer period.
You can use our car loan repayments calculator to estimate your repayments based on different terms.
4. The lender you choose
Our analysis shows that smaller lenders usually offer the lowest starting rates, while major banks are often less competitive. However, car loan interest rates can vary greatly depending on your personal circumstances. Comparing rates from different lenders will help you find the best rate you qualify for.
But there's a right and a wrong way to do this:
Wrong: Making applications with multiple lenders to see what offers come back (which could hurt your credit score).
Right: Using a service like Money.com.au (or a car loan broker) to compare multiple interest rate offers, without it impacting your credit score.
5. Fixed or variable interest rate
Most car loan interest rates in Australia are fixed. In fact, over 69% of the car loans on Money.com.au's lender database come with a fixed interest rate.
But for lenders that do offer the option of a fixed and variable rate car loan, currently more fixed rates are lower. This can be a sign that lenders expect interest rates in the economy to fall from current levels.
6. Your financial position
You'll generally qualify for the lowest car loan interest rates if you have:
- A high, reliable income (the average yearly income of applicants in our database is $120,481)
- Low regular expenses relative to your income
- Low levels of overall debt (e.g. credit cards and other loans)
7. Your employment status
You may qualify for a lower car loan interest rate if you're employed full-time and have been in the same job and industry for a sustained period. Most car loan applicants in our database were employed full-time (80.14%). The rest were employed part-time (9.25%), casually (7.43%) or in other types of employment (3.12%).
Casual and self-employed people can apply for a low doc car loan, but these usually come with higher interest rates.
If you're an ABN holder and will be using the vehicle mostly for business purposes, you can apply for an ABN car loan. Again rates on this kind of finance will likely be different to consumer car finance.
8. Whether you own a property
Over the years, we've found it's common for lenders to consider whether the borrower owns a property when calculating their car loan interest rate.
Property owners generally qualify for lower rates. Property owners who also have a high level of equity in their property (i.e. more of their home loan is paid off), get the lowest rates.
This might not seem particularly relevant for a car loan. But the way lenders look at it, it's another signal about how risky a borrower is.
Some lenders simply bundle this factor into the overall calculation, while others (Macquarie Bank is an example) advertise different car loan interest rates specifically for property owners.
A recent Money.com.au survey found that 24% of Australians who financed their car through a bank or lender were homeowners with a mortgage. 18% were renters, 10% were in other living arrangements (e.g. living with parents), and only 6% were homeowners without a mortgage.
9. Your loan amount
Your loan amount can impact your car loan interest rate. The impact could be either positive or negative depending on the situation. Here are two scenarios to illustrate the point:
- For an already higher risk borrower, a larger loan amount adds to the risk and the lender may reflect this with a higher interest rate.
- Some borrowers may charge a lower rate to low-risk borrowers with larger loan amounts (the same thing commonly happens with home loan rates).
10. Your loan-to-value ratio (LVR)
The loan-to-value ratio on a car loan is the loan amount expressed as a percentage of the value of the car it's being used to finance.
A higher LVR (where you're borrowing a higher percentage of the car's purchase price) may mean a higher interest rate.
Note, some lenders will allow you to borrow more than 100% of the car's value. For example, you might get finance to buy an electric vehicle, plus a home charger and battery. If you own another vehicle, you may be able to borrow more than 100% of the value of a new car, using your current car as additional security.
What can you get with a car loan?
A car loan allows you to borrow a set amount of money to buy a vehicle, and repay it plus interest over a fixed term. The vehicle you purchase secures the loan. This means the lender can reclaim it if you can't repay the loan. Here are some key features of car loans:
- Borrow from $5,000 - $200,000
- Can be used for new or used cars
- Loan terms from 1 - 7 years
- Fixed or variable interest rates
- Interest rate tailored to you
- Weekly, fortnightly or monthly repayments
- Some loans allow for extra repayments and early payout
- Balloon payment option
- No deposit required
How to get the best car finance deal (in 6 steps)
1. Get a secured car loan Some lenders advertise unsecured personal loans as being 'car loans'. A secured car loan will almost always have a lower rate. 2. Apply for pre-approval Getting car loan pre-approval means you won't be rushed into a car loan with a high interest rate at the last minute. 3. Shop around Only apply for a car loan once you've compared multiple lenders and you’re confident you’ve found the lowest interest rate you qualify for, with low fees. 4. Consider smaller lenders Some of the cheapest car loan interest rates may be offered by lenders you've never heard of. Currently, some of the cheapest rates are offered by Harmoney, Great Southern Bank, Now Finance, Pepper Money and Liberty Financial. 5. Match the loan to your car For example, if you're buying an EV, be sure to take advantage of the discounts available with specialist 'green car loans'. If you're buying a brand new car, loans specifically for new cars typically offer lower interest rates than generic car loans. 6. Make sure your loan is flexible Look for the flexibility to make extra repayments and pay off the loan early without penalty. 'Redraw' is another handy feature, as it means you can withdraw any extra repayments you have made if you need to access cash.
BONUS TIP: Give yourself a better chance of car loan approval
It’s a good idea to do some preparation before you start applying for car loans. Check your credit report so you can anticipate any issues and work out a comfortable budget for making car loan repayments each week, fortnight or month. Then only apply for car loans that are easily within your budget.
Types of car loans you can apply for
Secured car loan
A secured car loan is when the vehicle you’re purchasing is used as security for the loan. If you fail to repay the loan, the lender can take back the car. This type of car loan generally offers lower interest rates due to the lender’s reduced risk, but it also means if you default on the loan, you could lose your car.
Unsecured car loan
An unsecured car loan does not require the vehicle to be used as security. The lender offers the loan based on your overall financial situation (including existing assets you own like your home) and your ability to repay the loan. Unsecured car loans typically come with higher interest rates than secured loans, as the lender takes on more risk.
Low doc car loan
A low doc car loan is aimed at self-employed individuals or business owners who don’t have traditional sources of income. Lenders usually require less paperwork, often as little as a declaration of income from an accountant, your ABN or ACN if relevant, and other details about your business. Not all lenders offer low doc car loans and in most cases, rates will be higher.
Used car loan
A used car loan is an option for those purchasing a second-hand vehicle, and it can be either secured or unsecured. Interest rates are typically higher than for new car loans and lenders may impose age restrictions on the vehicle (i.e. no older than 7 years).
Green car loan
A green car loan is specifically designed for purchasing eco-friendly vehicles, such as EVs or hybrid cars. They often come with lower interest rates and special incentives (like small discounts) to encourage consumer adoption of this technology.
Bad credit car loan
A bad credit car loan is aimed at borrowers who have a poor credit history, such as those with defaults or missed payments. These loans give individuals with bad credit an opportunity to secure finance. The trade-off is that they usually come with higher interest rates and stricter terms to offset the lender’s risk.
Chattel mortgage
A chattel mortgage is a type of secured car loan for vehicles that are used for business purposes at least 51% of the time. With a chattel mortgage, the business owns the vehicle, but the lender holds a mortgage over it.
Am I eligible to get a car loan?
To qualify for a car loan in Australia, you'll typically need to meet these eligibility criteria:
- Be over 18 years of age
- Be an Australian citizen or permanent resident
- Have a regular source of income (most lenders look for six months of steady income)
- Have no major issues in your credit history
- Be buying an eligible vehicle (new or used up to 12 years old at the end of the loan term, with no finance outstanding)
How much will your repayments be?
See your estimated car loan repayments per week, fortnight or month.
Car loan repayment calculator
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FAQS about car loans
How do car loans work?
A car loan is a type of secured personal loan. The car you're buying is the security, meaning the finance provider can reclaim the car to recoup its costs if you can’t repay the loan.
This reduces risk for the lender and means car loan interest rates are usually lower than unsecured personal loans.
Car loans can be used for new or used cars, and for dealer or private sales.
With a secured car loan you should get:
- A low fixed rate
- Flexible terms and repayment options
- No deposit required
- Simple and quick approvals
What’s the best car finance option?
This guide has focussed on secured car loans, but it’s not the only way to finance a car. Depending on the situation and what the vehicle is used for, other options such as a novated lease are becoming increasingly popular.
And if you’re financing a business vehicle, you might look at a chattel mortgage, operating lease or finance lease.
What about adding the car purchase to your mortgage? This is known as home loan refinancing. It can be appealing because your home loan usually has a lower rate than you can get with a car loan. But long home loan terms (up to 30 years) can make this an expensive option over time.
How do I apply for a car loan?
The exact process will depend on the lender you apply with, but typically it goes like this:
Step 1. Compare car loan providers Step 2. Complete a loan application Step 3. Provide supporting documents (payslips, bank statements etc.) Step 4. Get pre approved by the lender. Step 5: Go car shopping, then… Step 6: Apply for full loan approval based on your chosen car Step 7: Sign the loan contract and provide proof of car insurance to the lender Step 8: The loan funds will be transferred to the car seller directly
What car loan fees are there?
The most common car finance fees are:
- Loan establishment/application fees
- Annual and monthly fees
- Extra repayments/early payout fees
- Missed repayment fees
The comparison rate gives a closer estimate of the overall cost of your car loan based on interest AND fees. Lenders are legally obliged to show this when advertising car loans.
What credit score do I need for a car loan?
This depends on the lender. It also depends on which company they check your credit score with as the score ranges vary. As an example, Equifax (one of the major credit reporting companies operating in Australia) classifies anything above 669 as being a ‘good’ credit score.
Having a good credit score means you would be eligible for a loan with most lenders (depending on your other circumstances). Our latest car loan data shows that most borrowers who request car finance through Money.com.au have an average credit score of 818.
But having a bad credit score isn’t the end of the world. It can simply mean you need to apply with more specialist lenders.
If you have a bad credit score and your application is accepted, you may be offered higher rates and/or more restrictive loan terms.
Avoid making multiple car loan applications in a short space of time as this can damage your credit score.
How long does it take to get approved for a car loan?
A lot of car finance providers can pre-approve your car loan on the same day you apply.
For a fast turnaround, you’ll need to be able to prove your identity and supply documents to prove your income and expenses.
This usually includes your most recent pay slips, bank statements and home loan statements.
Typically, you can expect to be driving your car in 2-3 business days.
Which lender is best for a car loan?
This really depends on what you want from a car loan deal.
Online car loan lenders often have the lowest rates. They can also approve loans quickly in many cases, if your application is straightforward.
The reality is shopping around is the best way to find the most suitable lender for you.
Is there car finance available for specific vehicle manufacturers?
Generally your car finance options are the same regardless of what car you're buying. The exception is the finance offered through the manufacturer itself or a particular dealer.
We've written guides on the financing options and deals available for some of the most popular car manufacturers in Australia:
What are the pros and cons of car loans?
It's important to make an informed decision about whether a car loan is right for you. To help you do that, here's a summary:
Pros of car loans
- Means you can spread the cost of your car out over a number of years
- It's often a relatively easy and fast process to get a car loan
- With a car loan you may be able to buy a better and/or more up-to-date model of vehicle, assuming you can afford the repayments comfortably
Cons of car loans
- It will cost you more than buying a car using savings
- Some products can be complex, particularly how the costs are displayed (or not displayed) by some lenders
- Car loan fees can add up to a lot and are not always listed clearly
What is a good car loan interest rate in Australia?
This will depend on who you are and what kind of car you're buying. For a borrower with a good credit score buying a brand new car (particularly an EV), you should generally be aiming for a car loan interest rate below 8% p.a. and ideally closer to 6% p.a.
How can I get a lower car loan rate?
To be eligible for a lower rate car loan, here are some steps to consider:
- Compare rates with multiple lenders. It's very unlikely that the first rate you come across will be the lowest you can get.
- Negotiate the rate with the lender. You have nothing to lose by asking for a lower rate.
- Buy a newer car that's eligible for a lower interest rate.
- Contribute a deposit towards the cost of the car so you're borrowing less.
- Improve your credit score so you move into lenders' lower interest rate brackets
What is the comparison rate on a car loan?
The comparison rate on a car loan is designed to represent the true cost of the loan. It factors in the loan's interest rate as well as most fees charged.
As the name suggests, the comparison rate is designed to make it easier to compare loans based on their actual cost. It will highlight if a car loan has a deceptively low interest rate, but high fees inflating the overall cost.
Legally, car loans must be advertised with a comparison rate.
Will I get a lower car loan rate with a dealer or a bank?
Dealer finance is not generally known for offering fabulous value for money. In many cases, you'll pay a higher interest rate for the convenience of getting your car and the finance taken care of under one roof.
The government's Moneysmart website suggests you should "compare loans before visiting a car dealer".
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Sean Callery is the Editor of Money.com.au. He has over 15 years of international experience. He is qualified with a Certificate IV in Finance and Mortgage Broking (FNS40821) and is compliant to provide general advice in Tier 1 General Insurance (RG 146) products.
Jared Mullane is a finance writer with more than eight years of experience at some of Australia’s biggest finance and consumer brands. His areas of expertise include energy, home loans, personal finance and insurance. Jared is qualified with a Certificate IV in Finance and Mortgage Broking (FNS40821).
Important Disclosures
^Comparison rate warning
Unless otherwise stated, personal loan comparison rates are calculated based on a loan amount of $30,000 repaid over a 5-year term. The comparison rates only apply to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees and cost savings such as fee waivers are not included in the comparison rate but may influence the cost of the loan. Check with the provider for full loan details, including rates, fees, eligibility and terms and conditions to make sure the product is right for you.
Lending Partners
For offers from Money.com.au lending partners, we will match you with lenders and rates based on the information you provide us. This won't affect your credit score. Some lenders displayed are not current Money.com.au partners and we can't guarantee rates from a specific lender.
Products, features and information displayed
General information only The information on this page is general in nature and has been prepared without considering your objectives, financial situation or needs. You should consider whether the information provided and the nature of any car loan product is suitable for you and seek independent financial advice if necessary.
We are not providing you with a recommendation or suggestion about a particular car loan. You should read the relevant disclosure statements or other offer documents before deciding whether to apply for or continue to use a particular product.
What products, features and information are shown While we make every effort to ensure all car loans available in Australia are shown in our comparison tables, we do not guarantee that all products are included. Our product comparisons may not compare all car loan features and attributes relevant to you.
Product information, such as interest rates, fees and charges, is subject to change without notice. We include a link to each provider on our table for you to also be able to see the relevant product information direct with the lender.
How car loans are sorted and filtered by default Users can easily change the sort order and apply product filters to our product comparison tables. However, when you arrive on a page initially, by default personal loans are sorted by:
- Lowest loan interest rate, then;
- Provider name (A-Z)
Commission we may earn
Our tables feature all car loans available from lenders on our database that match the search criteria selected. Lenders do not pay to feature in our tables, nor do we earn commission if you click to visit a lender’s website. The order of the products in the table is not influenced by any commercial arrangements.
If you get a car loan as a result of visiting this page, we may earn a commission.