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Bad credit car loans: who lends and what it costs

Yes, you can get a car loan with bad credit, from specialist lenders that publish their appetite for defaults, bankruptcy and thin credit files, but the rate is the price: Liberty’s Fresh Start car loan starts at 12.49% (comparison 15.06%) for up to $50,000, and Money3’s own examples show comparison rates of 19.30% to 32.60%. On $20,000 over five years that is about $450 a month at 12.49% against $522 at 19.3%. A broker checks which lenders will consider your file before an application is lodged, so declines do not pile up on your credit report.

Written by Daniel WongReviewed by James Mitchell, Editor-in-ChiefLast reviewed Published

How much is a $20,000 bad credit car loan per month?

Monthly principal and interest repayments over 5 years, by loan amount and interest rate
Loan amountMonthly repayment at
12.49%p.a.15%p.a.20%p.a.25%p.a.
$10,000$225$238$265$294
$15,000$337$357$397$440
$20,000$450$476$530$587
$25,000$562$595$662$734
$30,000$675$714$795$881

Illustrative monthly principal and interest repayments over 5 years, before fees and charges. Rates are examples, not offers; your rate depends on the lender and your circumstances. 12.49% is Liberty's published Fresh Start starting rate; 20% and 25% sit inside the comparison rates in Money3's own examples (19.30% to 32.60%). Run your own numbers.

Calculator

Bad credit car loan calculator

Estimate your repayments at specialist rates

Loan amount$20,000
$5,000$50,000
Interest rate12.49% p.a.
7.00% p.a.30.00% p.a.
Loan term5 years
1 year7 years
Monthly repayment
$449.86
Total interest
$6,991
Total repayment
$26,991
Principal 74.1%Interest 25.9%
Get a personalised quote

Estimates only. Actual rate and repayment depend on your lender, loan structure and credit assessment.

Car loan lenders a broker can check for a bad credit file

The car lenders in our directory. Most price on credit tiers and some will not take an impaired file at all; Pepper Money lists risk-tiered pricing for credit-impaired files, and the specialists that publish a bad credit policy are in the table below. The broker checks appetite before anything is lodged.

Car loan lenders a broker can check for a bad credit file: each lender's type, the products it offers and its current rate
Commonwealth Bank of AustraliaMajor bankProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
Current rate:
6.79%p.a.
8.20% p.a. comparison rate*
Personal Loan Secured (New Vehicle) · Secured Fixed Rate Car Loan, secured by the car being bought: from rate for excellent credit (rates up to 11.29% p.a.); comparison on a $30,000 loan over 5 years.
Westpac Banking CorporationMajor bankProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
  • EV / Green
Current rate:
6.49%p.a.
7.90% p.a. comparison rate*
Car Loan Secured · Car Loan for petrol, diesel or LPG cars, fixed rate, secured by the car: from rate; the rate offered depends on your credit assessment.
Bank AustraliaCustomer-ownedProducts:
  • EV / Green
  • Secured (used vehicle)
Current rate:
6.29%p.a.
6.29% p.a. comparison rate*
Clean Energy Car Loan · Electric Vehicle Loan, fixed rate, secured, new electric vehicles; establishment fee waived for fully electric vehicles; comparison on a $30,000 secured loan over 5 years.
Liberty FinancialNon-bankProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
Current rate:
8.99%p.a.
10.65% p.a. comparison rate*
Liberty Drive Secured · Flexible car loan, secured, new and used cars: from rate; comparison on a $30,000 new-car loan over 5 years with no balloon.
MoneyMeSpecialistProducts:
  • Secured (new vehicle)
Current rate:
6.24%p.a.
7.13% p.a. comparison rate*
MoneyMe Secured Car Loan · Secured car loan, variable rate, new or used vehicles: from rate for excellent credit history (maximum 26.10% p.a.); $12.50 monthly fee.
Now FinanceSpecialistProducts:
  • Secured (new vehicle)
Current rate:
7.59%p.a.
8.43% p.a. comparison rate*
NF Secured Car Loan (Tier 1) · Vehicle Loan secured by the vehicle, new or used: from rate (rates up to 15.39% p.a.); establishment fee up to $595.
PlentiSpecialistProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
  • EV / Green
Current rate:
7.99%p.a.
9.78% p.a. comparison rate*
Plenti Car Loan (Tier 1) · Secured car loan, new or demo vehicle, homeowner with exceptional credit: from rate (rates up to 12.99% p.a.); comparison on $30,000 over 60 months including a $14.90 monthly fee.
Australia and New Zealand Banking GroupMajor bankProducts:
  • Unsecured
Current rate: ANZ rate card (opens in a new tab)
National Australia BankMajor bankProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
Current rate: NAB rate card (opens in a new tab)
BankSAMajor-bank brandProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
Current rate: BankSA rate card (opens in a new tab)
Show all 16 lenders
Car loan lenders a broker can check for a bad credit file, continued
ING AustraliaTier-2 bankProducts:
  • Unsecured
Current rate: ING rate card (opens in a new tab)
IMB BankCustomer-ownedProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
Current rate: IMB rate card (opens in a new tab)
Newcastle Permanent (Newcastle Greater Mutual Group)Customer-ownedProducts:
  • Secured (new vehicle)
Current rate: Newcastle Permanent rate card (opens in a new tab)
Teachers Mutual BankCustomer-ownedProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
Current rate: Teachers Mutual rate card (opens in a new tab)
Pepper MoneyNon-bankProducts:
  • Secured (new vehicle)
  • Secured (used vehicle)
  • Unsecured
Current rate: Pepper Money rate card (opens in a new tab)
Angle FinanceSpecialistProducts:
  • Secured (new vehicle)
Current rate: Angle Finance rate card (opens in a new tab)

Inclusion is editorial reference, not a recommendation. Rates change often, so we only show a rate we captured from the lender's own page in the last 60 days, with a link to that page; otherwise we link to the lender's rate card where it publishes one. The broker you are matched with compares the lenders on their own panel.

See all 20 car loan lenders

* 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. Car loan comparison rates are based on a secured loan of $30,000 over 5 years.

Bad credit car loans at a glance
  • Specialist lenders publish that they consider defaults, discharged bankruptcy and thin credit files
  • Published specialist rates start from 12.49% p.a. (Liberty Fresh Start); comparison rates on small, short loans run to 30% or more
  • No credit enquiry at the quiz stage; the broker checks lender appetite before an application is lodged
  • A default stays on your credit report for five years, but paying it shows it as paid
  • A year or two of on-time repayments can open a refinance to a lower rate

What counts as bad credit in Australia?

Your credit history sits with the credit reporting bodies, and Moneysmart names the two main ones as Equifax and Experian. Lenders use that history, and the score built from it, to assess risk. “Bad credit” is not a fixed definition: different lenders draw the line in different places.

These are the marks on a credit file that mainstream lenders may decline you for:

  • Defaults: a debt of $150 or more at least 60 days overdue that the creditor has listed. A default stays on your report for five years, or seven after a clearout.
  • Court judgments: a court-ordered debt from a legal action. These remain for 5 years.
  • Part IX debt agreements: a formal arrangement to repay creditors. Listed for 5 years from the start date or 2 years from completion.
  • Bankruptcy: remains on your file for either 5 years from the date of bankruptcy or 2 years from discharge, whichever is later.
  • Multiple credit enquiries: several applications in a short period count against your score.
  • Missed repayments: a payment not made within 14 days of the due date is recorded in your repayment history.

Scores run from 0 to 1,000 or 1,200 depending on the agency. On Equifax's scale the bands are below average (0 to 459), average (460 to 660), good (661 to 734), very good (735 to 852) and excellent (853 to 1,200). A hardship arrangement you keep to does not affect your score, according to Moneysmart.

Which lenders consider a car loan with bad credit?

Two specialist lenders publish what they will consider; the banks and most prime car lenders do not. Checked against each lender's published page on 19 September 2026. Policies and rates change without notice; confirm with the lender or your broker before relying on them. Where a lender does not publish a figure the cell says so.

LenderWhat it publishes it will considerLoan size and termRates as publishedNotes
Liberty (Fresh Start car loan)Defaults, bankruptcy, financial hardship, and little or no credit history (young borrowers, new migrants)Up to $50,000; terms up to 5 yearsFrom 12.49% p.a. (15.06% p.a. comparison)Assesses income, savings and overall position rather than the score alone
Money3Over 18 with take-home income of at least $480 a week from earnings, Centrelink or bothExamples on the page: $5,000 over two years and $25,000 over fiveComparison rates in its own examples: 32.60% ($5,000 over 2 years) and 19.30% ($25,000 over 5 years)Secured personal loans used for vehicles; example fees on a $25,000 loan total $14,159.90
Pepper Money, Plenti, WisrCar loans offered; no bad credit policy published on a public pageNot publishedPricing is credit-tieredReachable through a broker

How bad credit car loans work

Bad credit car loans are structured like standard car loans, but they come from specialist lenders or the non-conforming divisions of larger lenders, which accept more risk in exchange for a higher rate.

Higher rates

Liberty's Fresh Start starts at 12.49% (comparison 15.06%), against secured car loan ranges that start around 6% at the major lenders for clean files.

Smaller loans and shorter terms

Liberty caps Fresh Start at $50,000 and five years. A smaller loan on a cheaper car keeps the repayment within reach.

Deposits and the car

A deposit and a newer car reduce what the lender stands to lose, which helps the approval and the rate. Most bad credit car loans are secured on the car.

A route back to a normal rate

Each on-time repayment is recorded in your repayment history. After a year or two of clean repayments, price a car loan refinance to a lower rate.

How a broker helps

Applying to the wrong lender with bad credit is costly: each declined application is recorded on your file. A broker works the other way round:

1
Tell the broker your situation
Your credit history, income and the car you want, before any application is made.
2
Lender matching
The broker matches your profile to lenders likely to consider it, avoiding unnecessary enquiries on your file.
3
One complete application
The application goes to the best-fit lender with the documents it needs.
4
Drive away
Once approved, settle, collect the car and start rebuilding your credit with each repayment.

Eligibility and what you need

Every lender has different criteria, but the general requirements for a bad credit car loan in Australia are:

  • Australian citizen, permanent resident, or eligible visa holder
  • Aged 18 years or older
  • Regular income from employment, self-employment, or Centrelink (some lenders, such as Money3)
  • Current bills being paid on time
  • Valid Australian driver's licence
  • The car identified, or an idea of its price and type
Rebuild while you repay

On-time repayments build your repayment history. After a year or two, compare what a refinance would save against the exit fee on the loan you have.

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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 calculated on a secured loan of $150,000 over 25 years for home loans, a loan of $30,000 over 5 years for car and personal loans, and $50,000 over 5 years for equipment finance, unless the lender states another basis.

Bad credit car loan FAQs

Can I get a car loan with bad credit in Australia?
Yes. Liberty publishes a Fresh Start car loan for borrowers with defaults, bankruptcy, hardship or no credit history, up to $50,000 with rates from 12.49% p.a. Money3 lends to anyone over 18 with at least $480 a week of income, including Centrelink, at comparison rates its own examples put between 19% and 33%. The difference between those two is why comparing lenders matters: the same borrower can pay very different amounts for the same car.
What is the biggest killer of credit scores?
Missed repayments and defaults. Moneysmart lists what your score is built on as how much you have borrowed, how many credit applications you make and whether you pay on time. A missed payment (not made within 14 days of the due date) is recorded in your repayment history, and a default, which can be listed once a debt of $150 or more is 60 days overdue, stays on your report for five years even after you pay it. A run of credit applications in a short time also counts against you.
Can you get a car loan with a 500 credit score?
Possibly, from a specialist lender. On Equifax’s 0 to 1,200 scale a 500 sits in the “average” band (460 to 660), below the very good to excellent range Equifax says is suitable for applying for a loan, so prime lenders may decline or price you higher. Specialist lenders such as Liberty publish that they assess income, savings and your overall position rather than the score alone, at rates from 12.49%. Experian scores run from 0 to 1,000, so check which scale your 500 is on.
What interest rate will I pay on a bad credit car loan?
It depends on how bad the file is and how small the loan. Liberty publishes from 12.49% p.a. for its Fresh Start product; Money3 publishes example comparison rates of 19.30% on a $25,000 five-year loan and 32.60% on a $5,000 two-year loan. Secured car loans for clean files start around 6% at the major lenders, so the gap is large. A deposit, a newer car and a smaller loan all help, and refinancing after a year or two of clean repayments is the usual exit.
Can I get a car loan with a default on my credit file?
Yes, from specialist lenders: Liberty publishes that its Fresh Start car loan considers defaults. A paid default stays on your report but shows as paid, which lenders view more favourably, and the age and size of the default matter. Some prime lenders will not take a current unpaid default at all: Pepper Money, for example, publishes that direct applicants must have no current unpaid defaults.
What credit score do I need for a car loan?
There is no single minimum, because every lender sets its own criteria. Equifax says a rating from very good (735 to 852) to excellent (853 to 1,200) may be considered suitable for applying for a loan, while specialist lenders publish that they look past the score to your income and overall position. Income stability, employment history and the car being bought all play a part.
Will applying for a car loan hurt my credit score?
A formal application is recorded on your credit report, and Moneysmart lists the number of credit applications among the things your score is built on. That is why a broker checks which lenders suit your file before an application is lodged, rather than you applying to several lenders and collecting declines.
How much deposit do I need with bad credit?
It varies by lender and by how serious the credit issues are, and few lenders publish a figure. A deposit reduces what the lender stands to lose, so it improves the approval odds and can lower the rate; saving one for a few months can be worth more than the car you would buy without it.
Can I get a car loan after bankruptcy?
Yes, from specialist lenders once you are discharged: Liberty publishes that its Fresh Start car loan considers bankruptcy. Mainstream lenders are harder; Pepper Money, for example, publishes that direct applicants must have no prior bankruptcies. Stable income and a clean record since discharge help, and the rate can come down as you rebuild your credit.
How can I improve my chances of approval?
Pay down any small defaults if you can, get your current bills up to date, save a deposit, choose a newer and cheaper car, and avoid several credit applications in a short period. Employment history matters too: Pepper Money, for example, publishes that direct applicants must not be on probation and that casual work must have run for more than six months.
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