Finance your car, boat, caravan or motorcycle purchase with a motor vehicle loan.

Learn more about how motor vehicle loans work, who’s eligible, and how the finance can help you get the keys to your own car, motorcycle, boat, or caravan.

The purchase of a car, motorcycle, camper, or boat can place heavy pressure on your personal finances. A motor vehicle loan lets you borrow money from a lender to buy a vehicle, giving you the ability to pay back the amount over time in more manageable instalments. This reduces the burden of having to make the purchase in full, giving you more flexibility with your personal cash flow.

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Here's how a motor vehicle loan works: You borrow money from a lender to help you buy the car, motorcycle, or boat that you want. This amount doesn’t have to be equal to the purchase price — you can choose to offset some of the cost with your private finances, and after that, you’ll have to make regular (generally monthly) payments on the loan, plus interest.

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A secured loan simply means that the purchased vehicle is used as security for the borrowed amount — if you fail to make repayments on the borrowed amount, the lender can claim your vehicle and sell it to recoup the cost of what you owe. This type of loan offers more reassurance to lenders, who in turn offer lower interest rates for secured loans.

Vehicles are not used as collateral in an unsecured loan, which increases the risk for lenders. Applications for unsecured loans will tend to face more scrutiny and offer higher interest rates to make up for the uncertainty that lenders face.

To get a motor vehicle loan in Australia, you will typically need:

  • proof of identity such as a driver’s licence or passport
  • a stable source of income, proven through pay slips or bank statements
  • a good credit history
  • details about the vehicle you want to purchase, such as make, model, and price.

How to choose the right motor vehicle loan

Lenders will offer a wide range of finance options for your motor vehicle purchase. Here's what you should look at when searching for the right motor vehicle loan for your situation: 

  • Interest rate – Does fixed or variable interest rate suit your situation?
  • Length of loan – Do you need a short or long loan term? A shorter loan will require higher repayments, whereas you might pay more interest over a longer loan
  • Total loan cost – Evaluate the total cost of the loan, including fees, charges and interest over the loan’s lifetime
  • Your budget – Ensure the loan is affordable by considering total running costs, including repayments, interest, storage, maintenance, registration, insurance, and fuel expenses
  • Fees – Check for flexibility in repayment options and added fees like prepayment penalties
  • Lender – Review the lender’s reputation, customer reviews and customer service
  • Requirements – Understand the loan’s terms and conditions, including insurance requirements
  • Consult an expert broker – Brokers focus on loans, comparing options from different lenders to find the best one for you.
Frequently Asked Questions for Motor Vehicle Loans

Most motor vehicle loans have a loan period between 1-7 years. The exact loan term for your motor vehicle loan will depend on various factors, ranging from how much you borrow to the size of the repayments.

Yes, although the terms for a business vehicle loan are different to that of a loan for a personal motor vehicle. Examples of business vehicle loans include chattel mortgages, finance leases, and novated leases. The main difference in the application of these loans is the requirement for details of the business’s finances.

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