Australia’s Best Car Loans for June 2025

When comparing loans you’ll notice that there are different types of car loans available based on the type of car you’re buying and how you want to secure the loan. These distinctions are important - not only so you can identify the type of loan that’s right for your situation, but because they can impact the interest rate you receive.

• New vs used car loans - On the surface the difference between new and used car loans is pretty obvious: new car loans are used to finance new car purchases while used car loans are for the purchase of second-hand cars. But it’s worth knowing that new car loans typically come with lower interest rates than used car loans. 

• Secured vs unsecured - If you opt for a secured car loan your vehicle will be used as collateral against the loan, so if you default, your lender will be able to take possession of the car. Unsecured loans, as the name suggests, don’t require security. However, because unsecured car loans are deemed riskier by lenders, the interest rates offered with them tend to be higher.

When searching for a loan it can help to identify the car loan features which will help you best achieve your goals. Aside from actually buying a vehicle, these could include making sure that your loan costs are as low as possible, or paying off your loan as quickly as you can. To do that, you may want to find a loan that offers:

• A low interest rate: The lower the interest rate, the lower your repayments will be. Though it’s always worth looking at the comparison rate too, because this also takes into account fees and other costs attached to the loan. 

• Low or no fees: Similar to nabbing a low interest rate, finding a car loan with low fees or even zero fees can help you reduce your overall costs. 

• Repayment flexibility: Repayment flexibility can mean different things. It could mean being able to make repayments on a schedule that suits your budget (e.g. weekly, fortnightly or monthly), or it could be having the option of making extra repayments towards your balance so you can pay it off faster. 

• Loan term: Car loan terms typically range from 1-7 years. Striking the right balance when choosing a loan term can be important, because while you may need to make larger repayments on a shorter loan term you’ll also reduce the amount of total interest you pay (assuming rates are the same).

The best type of interest rate to opt for with a car loan will depend on your own needs. For instance, if you want to know exactly how much you’ll need to make in terms of loan repayments then a fixed rate may be a good choice. Otherwise if you’re happy to be more flexible and make the most of any interest rate drops that come about, a variable rate may be what you’re after. Of course, interest rates can always jump higher too.

Because of the fluctuating nature of interest rates it’s difficult to highlight any one loan which has the lowest (or ‘best’) interest rate. After all, lenders can change their interest rates at any time, so a rate that’s competitive one week may not be the next. 

And not every borrower will have access to some of the lowest rates on offer. For example, many lenders offer personalised rates based on a customers’ credit history, which is why you may see an interest rate range, rather than a single rate, next to a car loan.

Yes, in many situations you will be able to refinance your car loan to another lender. However, you’ll have to weigh up whether it’s worthwhile. While you may be able to reduce your repayments by switching to a loan with a lower rate, you’ll need to factor in the costs of switching, including any exit or break fees with your existing lender or application fees with your new lender. If you are interested in making the switch, check out our dedicated refinance car loan comparison table to compare offers.

There’s no single best car loan deal out there - it’s all about what you want as a borrower. That’s why taking the time to figure out which type of loan you need, the features you want, and then comparing a range of options can be a good way of finding the ‘best’ loan for you. As the team at ASIC’s Moneysmart says, “Most people shop around before they choose a car. You should also shop around before you choose a car loan. It can save you thousands in interest and help you pay off your car faster.”

Comparing award-winning car loans - like the ones we’ve laid out above - could be one place to find a great value loan, otherwise if you’re ready to cast your eyes over even more offers then why not head on over to the Mozo car loan comparison hub where you can compare over 180 different car loans.

We have provided some of our editor’s picks and information about products which have got Mozo’s tick of approval through the Mozo Experts Choice and Mozo People’s Choice Awards. At the end of the day though, you will need to consider your own priorities and financial needs in order to identify which options are best for you. Be sure to read the information provided on a product issuer’s website before making a decision.