Who is buying, how the car will be used, whether it is new or used and how you structure the loan all change what finance you can get and what it costs. This guide goes through the choices in order and links to the detailed guide on each.
loan-o is a Brisbane finance broker based in Milton. We compare car and vehicle finance across a panel of 50+ bank and non-bank lenders. This guide is general information, so check the details of any offer and the tax side with your accountant.
Buying a car: the decisions that shape the finance
Who is buying, and how will the car be used
Tax rules differ between these, including how fringe benefits tax treats certain vehicles, and they change over time. Confirm the tax side with your accountant before you choose.
- A car for personal use: a personal car loan, with the car as security.
- A car used in a business, bought through an ABN: a chattel mortgage, which is a business loan in your name where you own the vehicle from day one.
- An employee whose employer offers salary packaging: a novated lease, a three-way agreement between you, your employer and a financier, paid from your salary.
New or used
The vehicle is the security behind the loan, and a used car is generally seen as higher risk security than a new one. Lenders often reflect that in a higher rate for used cars, though the gap varies by lender and by how old the car is. Many lenders also cap how old a vehicle can be by the end of the loan term, so an older car may only qualify for a shorter term, which raises the regular repayment.
A used car loan with a higher rate but a shorter term can still cost less overall than a longer new car loan, or the reverse can be true. Compare on total cost over the likely term, not on the price or the headline rate.
Dealer or private sale
Some lenders treat a private sale differently from a dealer purchase, particularly in how the car's condition, value and history are checked, and a few products are only available for dealer purchases. Check this before you settle on a particular car.
Deposits and balloon payments
Many car loans do not need a deposit. Where one is asked for, it depends on the lender, the age of the vehicle and your credit profile. A deposit reduces the amount you borrow, which lowers the regular repayment and the total interest. A trade-in works the same way as a cash deposit.
A balloon is a lump sum left owing at the end of the term. It lowers the regular repayment, but you still have to pay it or refinance it, and you pay interest on a higher balance for longer. A deposit and a balloon pull in opposite directions, and neither is right for everyone.
What the whole loan costs
On a personal car loan, the comparison rate folds in most fees alongside the interest rate, which gives a fuller picture than the advertised rate alone. Also compare the repayment, the term, any balloon, fees and the total you will pay, and what it costs to pay the loan out early.
Refinancing a car loan you already have
Refinancing swaps your current loan for a new one. It can lower the rate or the repayment, but exit fees and a longer term can cancel the saving. It usually makes less sense near the end of the term or when the car is worth less than you owe. Compare the full cost of staying with the full cost of switching.
Where to look for the car
Digger's Marketplace, a sister site of loan-o, lists cars, caravans, boats and trucks for sale from Australian suppliers. If you want finance for something you find there, an enquiry can be referred to loan-o. Digger's Marketplace is not a lender and does not provide credit.
- Digger's Marketplace Cars, caravans, boats and trucks for sale from Australian suppliers.
Vans, caravans and electric vehicles
Most leisure asset loans use the caravan or boat itself as security, and the asset's age and any business use can change the options. If the vehicle is electric, EVFinancer is a separate Australian brokerage that specialises in electric vehicle finance.
- Boat and caravan finance: secured vs unsecured
- A settled example: van finance for a first-time buyer
- Financing an electric vehicle for your business
- EVFinancer A sister brokerage that specialises in electric vehicle finance.
Questions to ask before you sign
- Why this lender and this loan structure for my situation?
- What will the repayments be, including any balloon, and what is the total I will pay?
- What fees apply, now and at the end of the term?
- What happens if I want to pay it out early or sell the car?
- What will the lender need from me, and how long will it take?
1. Car and vehicle finance
2. Cost and rates
3. Before you sign
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Finance is subject to lender approval, lending criteria, terms, conditions, fees and charges. The information in this article is general and does not take into account your personal or business needs. It should not be treated as personal financial, tax, legal or credit advice.
Last reviewed: 9 November 2026. This content provides general information only. It should not be treated as personal financial, tax, legal or credit advice.
Frequently asked questions.
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Not always. Many car loans do not need one, but a lender can ask for a deposit depending on the vehicle's age, whether it is a private sale and your credit profile. A deposit lowers the amount you borrow, the repayment and the total interest.
Often, because a used car is generally seen as higher risk security. The gap varies by lender and by the car's age, and age limits can mean a shorter term and a higher repayment. Compare total cost over the likely term.
A novated lease is for employees whose employer offers salary packaging, and payments come from your salary. A chattel mortgage needs an ABN and is a loan in your name where you own the car from day one. Tax treatment differs, so confirm it with your accountant.
Often yes, but some lenders treat private sales differently and check the car's condition, value and history more closely. A few products are only available for dealer purchases, so check before you commit to a car.
The repayment, the term, any balloon, fees, the total you will pay and what happens if you pay out early. On a personal car loan, the comparison rate folds in most fees alongside the interest rate.
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