How to get car loan ready for the EOFY

Ceyda Erem

26 Jun 2018

New car content

Whether it’s time for an upgrade or you’re craving a new set of wheels, the end of financial year (EOFY) may be the perfect time pick up a new car.

In fact, the latest ABS data shows that in June last year, over 134,000 new cars were purchased, before falling to just under 93,000 in July.

And since we all need a little help now and then, you may be considering a car loan to fuel (get it?) your car dreams.

But how do you know what to look for when you start your hunt for the perfect car loan? Lucky for you, we’ve got a few tips up our sleeves that may be able to help.

What to look for in a car loan

The type of loan 

Car loans usually come in two types, secured and unsecured. Here are the differences:

Secured car loans - If you decide on a secured car loan, you’ll be using your brand new car as security against the loan and, in return, you’ll generally get a lower interest rate. But it does mean that if you ever default on your loan, your lender has the right to repossess the vehicle.

Unsecured car loans - An unsecured loan won’t require any type of security, like your new car, but it usually will mean a higher interest rate.

The interest rate 

Ah yes, the interest rate - possibly one of the most important feature with any kind of loan. When it comes to interest rates, you’ll find there are two options:

Fixed interest rate - A fixed interest rate means you’ll be ‘locking in’ your rate for the entire loan length. This means that your rate won’t change, no matter how the market moves, so you’ll always know how much interest you’ll be paying to your lender. The downside? Fixed interest rates usually charge exit fees, so if you decide to pay out your loan early, you’ll need to factor in this extra cost.

Variable interest rate - A variable interest rate means the rate will fluctuate depending on the market. However, while the amount of interest you pay will jump around, it's rare you’ll find a variable rate loan with early repayment fees. So not only will you be able to pay off your loan early at no extra cost, you’ll get access to flexible loan features.

Which brings us to our next factor…

Nifty repayment features 

Because what’s a loan without some handy features? Once you start shopping around for car loans, there are two features to keep an eye out for:

Extra repayments - This sweet feature allows you to make extra repayments on your loan, helping you save on interest. However, keep in mind that your lender and the loan you pick may have a limit to how much you can repay, plus you may have to pay a fee to do so.

Redraw facility - What if you ever need that cash back? That’s where the redraw facility comes in. A redraw facility lets you redraw any of the extra repayments you’ve made to pay for other unexpected bills or expenses. Just remember that some lenders may have a minimum redraw amount and could charge a fee.

Speaking of fees…

The fees 

While it is possible to get yourself a loan that has minimal or no fees, there are a few you’ll need to watch out for, like:

Upfront or application fees - This is one of the most common types of fee and will need to be paid once you are approved for the loan. While it is a one-off payment, upfront fees can range between $0- $600.

Ongoing fees - Also known as a monthly service or maintenance fee, ongoing fees are the cost to keep your loan alive. These are usually paid on a monthly basis or annually.

Late repayment fees - This is a fee you’ll be charged if you don’t make your repayment on time.

Break fees - If you opt for a fixed rate loan and decide to end your loan before the fixed term, you will typically be charged a percentage of your original loan amount.

Discharge fees - Also known as the exit fee, discharge fees are charged to cover the cost of closing the loan and can reach up to thousands of dollars.

So now that you’re ready to start car loan shopping, check out some of these hot offers down below. Or, if you’d like to compare more options, head over to our car loan comparison tool.

5 car loans for the EOFY

Rates updated daily. Advertiser disclosure.

  • Promoted

    New Car Loan (Including Demo, Fixed, Secured)

    4.99% p.a.

    5.53% p.a.based on $30,000
    over 5 years

  • Promoted



    Car Loan (Fixed)

    4.89% 9.99% p.a.

    5.44% 10.56% p.a.based on $30,000
    over 5 years

  • Promoted



    Car Loan - Excellent Credit (Fixed, Unsecured)

    5.95% 19.99% p.a.

    6.79% 21.0% p.a.based on $10,000
    over 3 years

  • Promoted



    Secured Car Loan (Fixed)

    4.74% 16.01% p.a.

    5.01% 16.31% p.a.based on $30,000
    over 5 years

  • Promoted

    Beyond Bank

    Beyond Bank

    Low Rate Car Loan Special Offer (Fixed, Secured)

    4.69% p.a.

    5.01% p.a.based on $30,000
    over 5 years

^See information about the Mozo Experts Choice Car loans Awards