Australia’s cheapest car loans of 2021

By Tara McCabe ·

If like many of us, you don’t have the money upfront to pay for a car to get from A to B, right about now you’re probably looking at taking out a loan.

Now it would be totally understandable if ‘cheap’ is on the top of your car loan wish list. With a loan you’ll already be paying at least a little more than you would upfront, so you want to minimise that extra cost as much as possible.

To help you narrow down your options, we’ve come up with a list of Australia’s cheapest car loans in 2021. 

How did we pick these cheap car loans you ask? Well these particular products have just been awarded a 2021 Mozo Experts Choice Personal Loan Award in the categories:

  • Car Loan
  • Excellent Credit Car Loan
  • Used Car Loan
  • Excellent Credit Used Car Loan
  • Green Car Loan

Cheapest Car Loan winners

If you want to buy a shiny new car driven no further than to its spot in the sales lot, you might want to check out the winners of this award. That’s because this category is designed specifically to find the cheapest car loan for customers buying a new car.

Expert Judge Peter Marshall said, “For this award we took a scenario of a $30,000 loan, repaid over five years and worked out the overall cost. That includes both the principal and interest, plus any fees and charges that apply.”

“We then ranked the loans from lowest to highest cost and gave awards to what we deemed the cheapest car loans.” 

The winners were:

Australian Military Bank also scooped up a separate award for cheapest Excellent Credit Car Loan. That’s for customers with an excellent credit rating, looking to buy a new car.

Cheapest Used Car Loan winners

Next (pit) stop on our list of Australia’s cheapest car loans are loans for used cars. These products each bagged a Mozo Experts Choice Award for cheapest Used Car Loan. That is a loan that could be used to buy a car that is at least five years old.

Marshall said of these awards, “To pick the winners for this award, our research team compared the total cost of a $15,000 loan, repaid over five years. That includes the principal loan amount, interest payable over that time period and any fees and charges that come with it.”

Same as the new car loan, results were ranked from the most expensive to the cheapest. The winners were:

Again, Australian Military Bank’s Car Loan was the sole recipient of the cheapest Excellent Credit Used Car Loan. This loan is designed for customers with an excellent credit rating, looking for a used car loan.

Cheapest Green Car Loan winner

As you might have guessed, this last award category seeks to recognise Australia’s cheapest car loans for ‘greener’ cars. Of course green is a little vague, so let’s break that down. 

“The Green Car Loan award looks at loans that offer special rates or fees, in a bid to encourage Australians to buy low emission vehicles,” Marshall said.

After identifying loans that met this criteria, the research team calculated the overall cost of a $30,000 loan, repaid over five years. The experts were especially impressed with Loans.com.au’s Clean Green Car Loan, which was the only car loan to bag the award.

Why choose a Mozo Experts Choice award winner?

Like a lot of banking products, car loans can be confusing. First you have to think about the interest rate, then you have to make sure there aren’t any sneaky hidden fees that you don’t know about. 

Now to the everyday Australian who has plenty of other things to worry about, this can all be a bit overwhelming. That’s where we come in. Mozo has a website dedicated to comparing financial products and we’ve been doing it for over a decade.

Marshall says the research team knows where to start and what to take into consideration when looking at cost. 

“For the Mozo Experts Choice Award for new Car Loans, we assessed and compared 89 different personal loans, to see which ones had the most competitive pricing,” he said.

That’s just the tip of it though. To allow for any price variations over time, the team made calculations on three different dates over a three month period. The calculations in question took into account the applicable interest rate and all mandatory fees for each loan assessed. These mandatory charges could be application fees, service fees and any exit fees that apply.

As you can see, a lot of work goes into comparing financial products. The main aim of these awards is to highlight personal loan products on offer in Australia that really are market-leading. We don’t take this responsibility lightly and each year we do the calculations again so that Australians always have the most up to date information on what the most competitive personal loan products are.

Want to read more about the awards? Check out the Mozo Experts Choice Awards for Personal Loans page for the full winners list. Or read our methodology report, for more information on how the awards are conducted.

Compare car loans - last updated November 28, 2020

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

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  • mozo-experts-choice-2021

    4.67% p.a.

    5.22% p.a.based on $30,000
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    Terms from 3 to 5 years. Representative example: a 5 year $30,000 loan at 4.67% would cost $34,096.76 including fees.

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  • 4.89% p.a.

    5.53% p.a.based on $30,000
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    Terms from 1 to 7 years. Representative example: a 5 year $30,000 loan at 4.89% would cost $34,377.58 including fees.

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  • 4.89% p.a.to 8.89% p.a.

    5.44% p.a.to 9.46% p.a.based on $30,000
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    Terms from 3 to 7 years. Representative example: a 5 year $30,000 loan at 4.89% would cost $34,276.58 including fees.

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  • 5.19% p.a.to 18.95% p.a.

    5.46% p.a.to 19.26% p.a.based on $30,000
    over 5 years

    Terms from 3 to 7 years. Representative example: a 5 year $30,000 loan at 5.19% would cost $34,320.13 including fees.

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  • 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.

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^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.

Tara McCabe
Money writer

Tara McCabe writes across all areas of personal finance here at Mozo from banking through to insurance. Tara is expert at practical money tips, showing readers ways to live richer and be socially conscious while doing it. She earned a BA (Hons) in English Literature from Canterbury Christ Church University.