$40,000 Car Loans

Got your eye on a new ride or looking to upgrade from your two door to a family car and need to borrow $40,000? Here at Mozo we compare a wide range of car loans from banks, peer to peer lenders, and online lenders so that you can find the perfect loan and get your hands on the car of your dreams.

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How do I compare car loans on Mozo? 

Mozo’s car loan comparison engine enables you to plug in the loan amount and loan term you’re after and shows you the monthly repayment amount estimated for the car loan. You can change the loan term to see what your repayments will be if you borrowed $40,000 over 3 or 5 years so that you can find the right term to fit your budget before making a car loan application.   

What’s the comparison rate mean?

The comparison rate is an interest rate that combines the interest rate and the fees into one single rate. It was designed to help you more accurately compare the true cost of a car loan. The comparison rate advertised on our site for car loan is based on a $30,000 loan over 5 years, so if you’re borrowing $40,000 your comparison rate will be different. All lenders must disclose to you the comparison rate for your loan prior to you signing your application. 

What other resources does Mozo have on the site to help me choose a car loan?

We’ve got a range of free resources to help you with your car finance needs. In addition to the comparison tables that allow you to compare loans side by side, Mozo’s money experts have written detailed car loan product reviews to help you better understand key features of each loan and what to look out for. We’ve also got a range of helpful car loan guides that explain everything from car buying tricks and tips to the different types of car loan available.

$40,000 car loan comparisons on Mozo - page last updated August 08, 2020

Search promoted car loans below or do a full Mozo database search. Advertiser disclosure.

I want to borrow

years

  • 4.89% p.a.

    5.16% p.a.based on $30,000
    over 5 years

    Terms from 1 to 7 years. Representative example: a 5 year $30,000 loan at 4.89% would cost $34,052.58 including fees.

      Compare
    Details
  • mozo-experts-choice-2019

    4.67% p.a.

    5.22% p.a.based on $30,000
    over 5 years

    Terms from 3 to 5 years. Representative example: a 5 year $30,000 loan at 4.67% would cost $34,096.76 including fees.

      Compare
    Details
  • 5.50% p.a.

    5.85% p.a.based on $30,000
    over 5 years

    Terms from 1 to 7 years. Representative example: a 5 year $30,000 loan at 5.50% would cost $34,632.09 including fees.

      Compare
    Details
  • mozo-experts-choice-2019

    3.97% p.a.

    4.51% p.a.based on $30,000
    over 5 years

    Terms from 3 to 5 years. Representative example: a 5 year $30,000 loan at 3.97% would cost $33,525.38 including fees.

      Compare
    Details
  • 4.89% p.a.to 8.89% p.a.

    5.44% p.a.to 9.46% p.a.based on $30,000
    over 5 years

    Terms from 3 to 7 years. Representative example: a 5 year $30,000 loan at 4.89% would cost $34,276.58 including fees.

      Compare
    Details
  • 5.99% p.a.

    6.63% p.a.based on $30,000
    over 5 years

    Terms from 1 to 7 years. Representative example: a 5 year $30,000 loan at 5.99% would cost $35,290.67 including fees.

      Compare
    Details

*The Comparison Rate combines the lender's interest rate, fees and charges into a single rate to show the true cost of a personal loan. The comparison rates displayed are calculated based on a loan of $30,000 for a term of 5 years or a loan of $10,000 for a term of 3 years as indicated, based on monthly principal and interest repayments, on a secured basis for secured loans and an unsecured basis for unsecured loans. WARNING: This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

**Representative example figures and monthly repayment figures are estimates only, based on the advertised rate, mandatory fees, loan amount and term entered. Rates, fees and charges and therefore the total cost of the loan may vary depending on your loan amount, loan term, and credit history. Actual repayments will depend on your individual circumstances and interest rate changes.

^See information about the Mozo Experts Choice Car Loans Awards

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

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Car loan resources

Reviews, news, tips and guides to help find the best car loan for you.

Must knows when borrowing $40,000 for a car loan 

Finding the right loan to finance your next vehicle can sometimes be a bit overwhelming, especially with so many options available from a variety of lenders. This guide runs you through all the car loan essentials and FAQs so you can catch up on everything you need before you take out a car loan. 

What’s the difference between a secured and unsecured car loan? 

On your search for your car loan you’ve probably heard the terms “unsecured” versus a “secured” car loan and there is a big difference between the two, so it’s worth knowing what each means. Essentially, it can affect how much interest and even the amount of fees you pay towards your car loan. 

Secured car loan

If you are borrowing $40,000 for a new car, a secured car loan is a likely option. A secured car loan is a loan where you, the borrower uses collateral, such as the car, as security. Many lenders will only offer secured loans for new cars or cars less than three years old. While putting your new car up as collateral may seem daunting, secured loans usually have lower interest rates, and a lower rate means you can put more money into paying back the loan faster, which can end up saving you money over the life of your car loan.  

Unsecured car loan

Alternatively, borrowers have the option of taking out an unsecured car loan, meaning you don’t need to put up any assets for security. Unsecured loans are generally used when buying a used car, and you might be looking at a lower amount, for example a $10,000 car loan. Usually, unsecured loans have higher interest rates than secured loans but they can have features like free extra repayments so if you have the ability you can pay the loan off faster to save on interest.  

Should I choose a fixed or variable rate on a car loan? 

Not only do Australians have the choice between a secured or unsecured car loan, depending on the lender you’ll also have an option to choose between a fixed or a variable interest rate. The interest rate on your car loan is a factor that determines how much you’ll repay each month or fortnight, so you must figure out whether you’d prefer to lock one down or open yourself up to potential spikes or falls. 

Fixed rate car loans

If you’re borrowing $40,000 for a car, knowing how much your loan repayments will be each month could be a good option. Fixed rate loans mean that your repayments don’t change month on month, making it much easier to budget. These days, many fixed rate loans also allow the option to make additional repayments so if you do find that you’re able to pay out the car loan early, you won’t be hit with high fees. 

Variable rate car loans

Right now, interest rates are at record lows but could you afford it if you borrowed $40,000 and the interest rate jumped? This is the risk you take with a variable interest rate. The good news is that with variable rate loans, you’ll get lots of flexibility so you can pay back the loan faster, or switch car loans if you do find the interest rate or fees on the loan are creeping upwards.  

What will my monthly repayments be on a $40,000 car loan? 

Not all car loans are the same, and you'll likely have very different monthly repayments on a $40,000 loan than you might on a $20,000 car loan. Different factors like your loan term, interest rate and any additional fees will determine what your monthly repayments are. When considering a car loan, make sure you keep an eye on competitive fixed and variable rates so that you can get a rate that suits you while avoiding paying too much on interest every month. 

If the numbers are what you are after, jump over to our car loan repayment calculator to get a better idea of what you your monthly repayments could be. 

What money saving features should my loan have? 

If you’re prepared to borrow $40,00 to fund your new car dreams, the biggest cost saving features of your car loan is to choose a loan with a low interest rate and low fees. The less you pay in these, the faster you’ll be able to pay down the loan. 

Other features to look for include:

  • free extra repayments: Even if you put an extra $50 towards your loan each month, you’ll pay less interest overall and own your car a lot sooner. 
  • redraw facility: all those good intentions to pay down your loan early and you get an unexpected bill and need to tap into those funds. This is what a redraw is for. 
  • choice of repayment frequency: most lenders will give you the choice of weekly, fortnightly or monthly repayments.

Can I apply for a $40,000 car loan online? 

Yes! These days most lenders want you to apply for your loan online. Not only is it easier, but potentially you could get a get a response within a few hours and the funds deposited into your account the next day, depending on the lender. 

Before applying make sure that you gather everything you’ll need for you application, such as: 
  • - ID
  • - Proof of income 
  • - Details about your assets and liabilities.

More frequently asked questions

Will my credit history affect my chances of getting approved for a car loan? 

Yes, like on a regular personal loan or home loan, lenders will check your credit history and previous borrowing behaviour when assessing your eligibility. 

It is a good idea before you make any loan application that you check your credit score to make sure that there isn’t any issues that would affect your loan from getting approved. See our guide on how you can improve your credit score if you are wondering about the things that lenders will be looking for.

While many lenders now offer tiered interest rates and each lender will have their own criteria for loan funding.  

For a large car loan like $40,000, will a big bank be better? 

Most lenders will have minimum and maximum loan amounts, regardless of whether they are a big bank or not. In some instances, smaller lenders, online banks or peer-to-peer lenders might have better rates for larger loan sizes, that’s why it is so important to shop around. 

How long does it take to pay off a $40,000 car loan? 

With car loans, loan terms generally range from 1 to 7 years. Keep in mind, that you pay interest throughout the entire life of your loan, so the longer your loan the more you contribute to interest repayments. 

All lenders will want to make sure that you’ll be able to pay back the loan amount borrowed so make sure that when you are deciding on a loan term, you choose one that is realistic for you. You don’t want go for a small time period and find yourself too stretched. Sometimes it is better to opt for a longer loan term, but whenever you can make extra repayments so that you shorten the amount of time it takes to pay the loan back in full.   

So sit down, take a good look at your financial position and be realistic on how long it would take you to comfortably pay back $40,000. A good place to start is with Mozo’s budget calculator

How is a car loan different from a regular personal loan? 

As the name suggests car loans are specifically designed for the purchase of a motorised vehicle and often they have to be secured against the vehicle. But, that’s not to say that you couldn’t take a personal loan to pay for your car. 
A personal loan may be beneficial if you only want to use part of it to finance your car and your own savings for the rest. 

What traps should I look out for with car loans? 

There are three main things to steer clear of when take you out a car loan: 
  • high interest rates, 
  • too many fees, and 
  • not enough repayment flexibility. 

With so many options on the market, don’t settle for the first loan you see. Take the time to compare car loans so that you don’t fall into a trap that could cost you hundreds of dollars!

Car Loan Reviews

IMB Bank Car Loan review
Overall 1/10
No to IMB car loans!

Do not use this bank for a car loan if you or your company are in receipt of JobKeeper payments under Covid 19! Regardless if you are still working full time and receiving your normal pay.

Read full review

Do not use this bank for a car loan if you or your company are in receipt of JobKeeper payments under Covid 19! Regardless if you are still working full time and receiving your normal pay.

Customer service
2/10
Trust
1/10
Less
Gerry, Australian Capital Territory reviewed 1 day ago
Liberty Car Loan review
Overall 1/10
Never again.

Following up on my previous comments. The most arrogant company and employees I have ever come across, they have no understanding of what customer service is and they talk to you like they are your boss. Before you even consider this company for any loan just think twice. Unfortunately I do have a loan with them which I have to see out as I will always pay my debit but never again. Just try any other company except Liberty.

Read full review

Following up on my previous comments. The most arrogant company and employees I have ever come across, they have no understanding of what customer service is and they talk to you like they are your boss. Before you even consider this company for any loan just think twice. Unfortunately I do have a loan with them which I have to see out as I will always pay my debit but never again. Just try any other company except Liberty.

Price
1/10
Features
1/10
Customer service
1/10
Convenience
1/10
Trust
1/10
Less
Mohamed, Victoria reviewed 1 day ago
Liberty Car Loan review
Overall 1/10
Don't trust Liberty and avoid them.

Before you apply with Liberty or even talk to them please try another provider. They are arrogant and can't be trusted. I am a current customer and I pay my loan but the way they treat their customers is so bad you won't believe. This is a warning for anyone who is trying to get a loan from them.

Read full review

Before you apply with Liberty or even talk to them please try another provider. They are arrogant and can't be trusted. I am a current customer and I pay my loan but the way they treat their customers is so bad you won't believe. This is a warning for anyone who is trying to get a loan from them.

Price
1/10
Features
1/10
Customer service
1/10
Convenience
1/10
Trust
1/10
Less
Mohamed, Victoria reviewed 8 days ago

Car loan guides

Car loan news

Car loans: What the new and used vehicle market looks like this winter

Whether you’re on the hunt for a shiny brand-new set of wheels or a pre-loved vehicle with a bit of character, let’s peep into the Aussie car market right now. This month, the Federal Chamber of Automotive Industries (FCAI) released stats that showed an increase in new car sales over June. Sales totalled to 110,234 vehicles last month. While it’s true that this number is a 6.4% decrease in comparison to June 2019, it’s the strongest result since the beginning of the pandemic. In fact, sales plummeted by 17.9% over March, 48.5% in April and by 35.3% in May. FCAI chief executive, Tony Weber says that the slight increase in sales in June is due to a range of factors, including the easing of COVID-19 restrictions in some states.“In addition, June is traditionally a very strong month for new vehicle sales,” Weber said. The End of Financial Year campaigns are well known, so it’s an excellent time for businesses and consumers to replace their vehicles.”He also attributed the growth in sales to the Government’s extension of schemes like the instant asset write-off for businesses, initiatives like the JobKeeper and JobSeeker payment packages, and the uptick in marketing activity from car brands and dealerships. What about used cars? Well, recent data from Moody Analytics and Datium Insights revealed that wholesale used vehicle prices rebounded in Australia by 10.6% in May 2020.Moody's Analytics’ auto economist, Michael Brisson predicts that these increased prices are likely to remain over the coming months. This increase comes after a 12% drop in prices in March and April this year.  

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