Aussies urged to save on car loans as providers drive rates down

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Aussies could grab a better deal on their car loan this November, after the Mozo database recorded a range of rate cuts across the market in October.

Mozo’s Banking Roundup for October revealed that the Mozo database recorded more changes to the personal loan market during the last month than it had in over a year, with big cuts to car loans in particular.

“Since October 1, we’ve seen five providers make cuts to car loans and while this might not be the biggest number, the cuts themselves have been substantial,” said Mozo’s Head of Product Data, Peter Marshall.

Headlining the raft of market changes was a massive 350 basis point cut to Move’s variable New Car Loan rate which now sits at 5.39%.

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The cut means that savings are to be had for Aussies looking to nab a new car loan. According to Mozo’s Car Loan Comparison calculator, you would have paid in excess of $2,000 in interest on a $15,000 Move New Car Loan over three years, but at the new rate, customers would pay just $1,279 - a saving of $865.

“Aussies can definitely save on their car loan at this time of year. With the end of the year around the corner, a lot of car retailers and manufacturers put on sales and lenders want to get out competitive rates that make car loans that bit more affordable and attractive,” said Marshall.

Move were not alone in reducing their car loan rates, with Auswide Bank and RACV also making noteworthy changes.

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If you’re after the security and certainty of a fixed rate, Auswide’s sweep of personal loan changes included an 80 basis point cut to its Fixed New Car Loan and Fixed Used Car Loans which now sit at 6.99% and 8.99%, respectively.

Despite the host of changes, market leader Community First continues to lead the pack with the lowest interest rate available for secured car loans of just 5.34%.

If you’re ready to apply for a car loan, check out our top tips to making the application process run as smoothly as possible.

Three tips to help get your car loan approved

  • Residency: If you want your car loan approved, you’re absolutely going to need to be an Aussie resident.

  • Borrowing power: You need to be realistic about how much you want to borrow and this will usually depend on how much you earn, so don’t set your sights too high.

  • Keep your credit history clean: Important no matter what type of loan you’re after, the provider is going to trawl through your credit history so stay up to date with your finances and pay all of your bills on time!

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