Secured or unsecured?

A loan secured by the vehicle prices lower but the lender can repossess. Unsecured costs more and does not.

What is the comparison rate, not the advertised rate?

The comparison rate folds in most fees on a standard example, which is the only way two consumer loans can be lined up honestly.

Is there a balloon payment at the end?

A balloon lowers the monthly figure and leaves a lump sum owing on a car that has depreciated.

What are the early repayment terms?

Fixed-rate consumer loans often carry an early termination fee, which quietly removes the option to get out cheaply.

Lane 6 of 7

Car and personal loans

Short-term consumer borrowing where the term and the fees, not the headline rate, usually decide what it costs you.

You are in this lane if

You are buying a vehicle, privately or through a dealer
You need a fixed-term personal loan for a defined purpose
The amount is small relative to a mortgage and the term is under about seven years

You are not, if

You are financing a vehicle mainly for business use — that may be a chattel mortgage or lease, which sits in the commercial lane
You are thinking of adding the amount to your mortgage — cheaper per month, far more expensive over thirty years

What actually decides the outcome

In order. Getting these settled first is the difference between a useful conversation and three weeks of email.

Secured or unsecured? A loan secured by the vehicle prices lower but the lender can repossess. Unsecured costs more and does not.
What is the comparison rate, not the advertised rate? The comparison rate folds in most fees on a standard example, which is the only way two consumer loans can be lined up honestly.
Is there a balloon payment at the end? A balloon lowers the monthly figure and leaves a lump sum owing on a car that has depreciated.
What are the early repayment terms? Fixed-rate consumer loans often carry an early termination fee, which quietly removes the option to get out cheaply.

Have this ready

Assembled before you start, not chased afterwards.

Photo ID and proof of income
Three months of transaction statements
Quote or contract of sale for the vehicle
Details of any trade-in or existing finance to be paid out

Where people get caught

Buying the dealer's finance without pricing an outside option first.
Not running a PPSR check on a private sale, so the car arrives with someone else's debt attached.
Adding insurance and warranty products into the financed amount, where you pay interest on them for years.

The official source

These set the rule. Anyone describing it to you — including this page — is a summary, and summaries go stale.

Structure of this page reviewed 17 August 2026. Follow the links for the current position.

How your income changes this lane

Salaried employee Undisclosed buy-now-pay-later accounts and unused credit card limits. The limit counts against you, not the balance. Contractor or casual worker Gaps between contracts that look like unemployment on a bank statement. Be ready to explain them in writing.

Not your lane after all?

First home loan Refinance Investment property loan Self-employed and low doc Commercial and business lending Bridging finance

Run the three questions again

General information. General information about how Australian lending is organised. Rules, thresholds and eligibility are set by government agencies and change; each lane links to the source so you can check the current position. It does not take your own circumstances into account.