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

By Polly Fleeting ·
young couple just bought new car with loan

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.  

Where do new and used car loan interest rates sit now? 

According to recent Mozo stats, the average new car loan fixed and variable interest rate (for a $30k loan) sits at 6.45%. While the average used car rate is 7.02%. 

The lowest variable new car loan on our database is currently 2.99% (3.35% comparison rate*), offered by Queensland Country Bank on its New Car Loan.  

And for used cars, the lowest rate is offered by Australian Military Bank, as its Car Loan (for vehicles up to 5 years old) comes with variable rates starting from a competitive 3.60% (4.48% comparison rate*).

Want to see some hot new and used car loans on the market right now? Compare below!

Compare new car loans

Loans.com.au New Car Loan
Promoted
  • 4.67% fixed interest rate (5.22% comparison rate*)
  • Extra repayments allowed
  • No ongoing monthly service fee

If you need a new car loan with a competitive interest rate, flexible repayment options and no ongoing fees, check out what’s on offer from loans.com.au. With the New Car Loan, customers can borrow up to $100,000 and receive a low 4.67% fixed interest rate (5.22% comparison rate*). And when it comes to paying down the loan, there’s the option of a weekly, fortnightly or monthly repayment schedule. Plus, extra repayments are allowed. Just keep in mind, there is no redraw facility and you could be charged $700 for paying down your loan early.

Beyond Bank Low Rate Car Loan Special Offer
Promoted
  • 4.89% fixed interest rate (5.22% comparison rate*)
  • Extra repayments and redraw facility
  • No ongoing fees or early repayment charges

Need a loan to help you get your hands on a brand new car? Introduce yourself to the Beyond Bank Low Rate Car Loan Special Offer. This loan comes with a competitively low fixed rate of 4.89% (5.22% comparison rate*), but that’s not all it's got going for it. Choose to make weekly, fortnightly or monthly repayments, and make extra repayments and redraw if you want to. You may also be pleased to know there is no early repayment penalty, exit fee or service charge attached to this loan, but don’t forget the $175 upfront application cost.

RateSetter New Car Loan
Promoted
  • Interest rates from 4.89% (5.44% comparison rate*)
  • Free extra repayments
  • No service or exit fee

Got good credit and also looking for a new car loan? Say hey to RateSetter’s New Car Loan. Based on your credit history you could receive a personalised fixed interest rate as low as 4.89% (5.44% comparison rate*). Customers can borrow up to $100,000 with this loan and not have to cough up cash for ongoing service fees. While there is only the option to make monthly repayments, RateSetter allows borrowers to make free extra repayments, without charging an early repayment penalty. It’s important to note there is a hefty $399 application fee attached to this loan.

Compare used car loans

Heritage Bank Car Loan
Promoted
  • Fixed interest rate of 5.99% (6.63% comparison rate*)
  • Available for cars up to 5 years old
  • Extra repayments and redraw facility

Eyeing off a car that’s up to 5 years old? The Heritage Bank Car Loan could be the way to get your hands on the keys! Not only does this loan come with a competitive 5.99% fixed interest rate (6.63% comparison rate*), customers can borrow up to a massive $100,000. Plus, there are flexible repayment options. Choose from weekly, fortnightly or monthly repayments, and enjoy the added bonus of extra repayments and a redraw facility. Just watch out for the $200 application fee and $5 ongoing monthly service fee.

OurMoneyMarket Car Loan
Promoted
  • 5.50% fixed interest rate (5.85% comparison rate*)
  • Extra repayments
  • For both new and used vehicles

Whether you’re after a new or used car, OurMoneyMarket’s Car Loan could be the right choice for you. With a low fixed rate of 5.50% (5.85% comparison rate*) and no ongoing service fee or exit cost, this loan is a pretty attractive option. Not only that, borrowers have a bunch of repayment schedule options on this loan. For example, they can make extra repayments without being charged an early repayment penalty if they pay the loan off early. But there are some costs to be mindful of, such as the $250 application fee and $35 late payment fee if you miss a regular repayment.

Wisr Secured Car Loan
Promoted
  • Fixed rates from 5.19% (6.08% comparison rate*)
  • Free extra repayments
  • No monthly service fee, exit fee or early repayment penalty

Need a loan with a low interest rate? But also with minimal fees and flexible repayment options? The Wisr Secured Car Loan could be exactly what you’re looking for. This loan has fixed rates starting at a competitive 5.19% (6.08% comparison rate*) as well as no monthly service fees or exit fee attached to it. And if you want to pay down your loan early without penalty, you can! There are free extra repayments on this loan as well as no early repayment charge if you pay down the loan before expected. Just bear in mind though, there is a $605 upfront fee when you apply for this loan.

If you want to check out even more car loan options, jump over to our new car loans or used car loans comparison tables.

*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.

Mozo may receive advertising fees from the financial institutions, issuers of financial or credit products and third party advice providers that are shown on this page. These fees are based on a cost per click, cost per acquisition, or a fixed fee.

Polly Fleeting
Polly Fleeting
Money writer

Polly Fleeting is a personal finance writer here at Mozo, specialising in loans and credit cards. Her work is aimed at helping people find ways to make smart product choices, reduce debt and get more for their hard-earned dollars. Polly has a degree in Journalism from the University of Technology, Sydney.