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Australian Car Loan Categories 2026

Six categories of Australian car finance, with the borrower profile each suits and the trade-offs to watch. For current rates, see each lender\'s own rate card via the lender directory.

What this page does and does not do
  • Categorises Australian car finance by borrower profile and product structure.
  • Surfaces the trade-offs between secured, unsecured, EV, refinance, business and bad-credit lending.
  • Does NOT publish current rates: those sit with each lender on their own rate card.
  • Cross-links to the lender directory and the broker-quote application.

The categories below cover the structural shape of the Australian car finance market. Inclusion is editorial reference; the right product for a specific borrower depends on credit profile, vehicle, deposit and serviceability, and that comparison is what a broker does after a full conversation about the file.

Secured

Secured car loans

For most car buyers, the secured car loan is the default. The lender registers a security on the PPSR; in exchange, you access the cheapest pricing tier. Vehicles under 7 years old at end of term qualify for the broadest lender panel.

Best for

  • New or recent-used vehicles under 7 years old at end of loan
  • Borrowers with clean credit and stable income
  • Buyers who plan to own the vehicle for the full loan term

Watch out for

  • Dealer-finance equivalents typically price above broker-panel secured for the same borrower
  • Vehicle age caps at end of term (most lenders 10 to 12 years)
  • Balloon payments that lower monthly cost but raise total interest
Find a secured car loan broker →
EV / Green

EV and green car loans

Battery-electric vehicles attract a rate discount on most lender panels. For battery-electric buyers under the LCT fuel-efficient threshold, the loan choice interacts with the novated lease decision; both are worth modelling against each other.

Best for

  • Battery-electric vehicle buyers under the LCT fuel-efficient threshold
  • Buyers eligible for state EV stamp duty concessions
  • Borrowers comparing novated lease vs straight loan structures

Watch out for

  • Plug-in hybrid eligibility narrowed in 2025 after the FBT exemption ended
  • Some lenders cap maximum loan size lower for EVs than ICE
  • Battery warranty and resale value affect lender eligibility
EV car loans hub →
Refinance

Car loan refinance

Borrowers who took dealer finance can typically refinance into a broker-sourced secured loan at a lower rate, saving meaningfully over the remaining loan term. The break-even maths needs to clear current-loan exit fees and new establishment costs.

Best for

  • Borrowers on dealer finance with 18+ months remaining
  • Anyone whose credit profile has improved since the original loan
  • Borrowers with a clean payment history on the existing loan

Watch out for

  • Early-payout fees on fixed-rate dealer products
  • Term-extension trap: lower monthly, higher total cost
  • Vehicle age limits at the new lender (must qualify for the full new term)
Refinance car loan guide →
Unsecured

Unsecured car loans

When the vehicle is too old, too specialty, or too cheap for a secured loan to make sense, an unsecured personal loan is the path. Rates run several percentage points higher than secured, but the eligibility is broader and disposal flexibility is real.

Best for

  • Vehicles over 12 years old at end of loan term
  • Specialty vehicles (kit cars, classics, project vehicles)
  • Loans under $10,000 where secured fees outweigh the rate saving

Watch out for

  • Higher rates compound quickly on longer terms
  • Some unsecured lenders run aggressive promotions with weak product behind
  • Establishment fees not always priced into headline
Personal loan guide →
Business

Business car loans

For SMEs buying vehicles for genuine business use, chattel mortgage is the default product. You take ownership on day one, claim GST up front, and claim depreciation or the instant asset write-off at tax time. The structure choice interacts with EOFY tax positioning.

Best for

  • Sole traders, partnerships, trusts, companies with genuine business use
  • Buyers eligible for the $20,000 instant asset write-off
  • Operators replacing vehicles at predictable intervals

Watch out for

  • Business use percentage affects deductibility
  • AASB 16 lease accounting impacts on operating-lease alternatives
  • Sub-2-year businesses pay a credit-overlay premium
Equipment finance guide →
Bad credit

Bad-credit car loans

Specialist subprime lenders work with credit-impaired borrowers, often through a broker who knows which lender will accept which file. Rates run higher than prime, terms shorter, deposit usually higher. The product fit depends materially on the specific credit history.

Best for

  • Borrowers with paid defaults aged 12+ months
  • Self-employed with bank statement evidence but no recent tax returns
  • Borrowers rebuilding credit who need vehicle finance now

Watch out for

  • Some subprime lenders use punitive default-interest clauses
  • High establishment and ongoing fees on subprime products
  • Term length shorter than mainstream (often 3 to 4 years max)
Bad credit car loan guide →

WARNING: This comparison rate is true only for the example given and may not include all fees and charges. Different terms, fees, or other loan amounts might result in a different comparison rate. Comparison rates are based on a secured loan of $30,000 over 5 years for vehicle finance and $50,000 over 5 years for equipment finance, as required under the National Credit Code.

Car loan categories FAQs

Common questions about the framework on this page.

How do I find the cheapest car loan rate in Australia?
Live rates change frequently and depend on your borrower profile (credit, income), the vehicle (age, condition), and whether the loan is secured. The cheapest published rate is rarely the rate offered to a specific borrower. The most reliable path is a broker-panel comparison; they will quote your comparison rate at your exact loan amount. Use the application link to start that.
Why does this page not show rates?
Live rates change with cash-rate moves and lender re-pricing announcements. The legally-required comparison rate is calculated by each lender on a standard example ($30,000 over 5 years for car loans). The most accurate, current number for any product sits on the lender's own rate card. We link out so the reader sees the live number from the source.
Are EV car loans cheaper than ICE?
Most lender panels offer a discount for battery-electric vehicles, typically a fraction of a percentage point. The discount can change; check directly with the lender. Plug-in hybrid eligibility narrowed in 2025 after the FBT exemption ended for plug-in hybrids on 1 April 2025.
Should I get a car loan from a broker or the dealer?
Broker finance typically prices below dealer finance for the same borrower because dealers are paid a commission on the rate margin and are restricted to one or two financiers. A broker compares across the panel.
What is the difference between best for new cars and used cars?
Lender panels treat new and used cars differently. Most lenders go up to about 12 years old at end of loan term for used vehicles. Older or specialty vehicles are accepted by fewer lenders. Used-car rates are typically a fraction of a percent higher than new-car rates from the same lender.
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