Ultimate guide to financing a Toyota

By Polly Fleeting ·

In this guide: 

  • Toyota finance options 
  • Features to look for 
  • The cost of Toyota finance
  • What you need to finance a Toyota 

Options for Toyota finance 

So you’ve decided to buy a Toyota. Oh what a feeling! 

For years after the first Land Cruiser arrived in Australia in 1958, Toyota has been a popular choice for many drivers. From a reliable Yaris, to a hybrid Prius, to a heavy duty Hilux, there are plenty of options out there. 

But what choice do you have when it comes to financing your new vehicle? Read on and find out…

  • Car loan: A type of secured loan that is used specifically for the purchase of a vehicle, where you pay back what you borrowed plus interest. There is the option to choose between a fixed or variable rate, plus rates are generally lower as the Toyota you buy is put up as collateral against the loan.  
  • Unsecured personal loan: This loan can be used to buy a vehicle without having to put it up as security. In fact, these loans don’t require you to give up any of your assets as security at all. Just keep in mind, you’ll often receive a higher interest rate than a secured loan.  
  • Dealer finance: A form of financing that is offered to you at the car dealership. It is the faster option as you can apply, be approved and drive away all on the same day. There are often low rates attached (1% or less) but be mindful, you might have to sign up for a lump sum balloon payment at the end of the loan. 
  • Chattel mortgage: This is essentially a car loan for businesses that need to purchase a vehicle. With a chattel mortgage a business can buy a car upfront, then from the income the car generates, the loan is paid down gradually (over 2 to 5 years). However, if a business cannot pay down the loan, the loan provider can repossess the vehicle. 
  • Novated lease: A way to lease a car by making a salary sacrifice arranged by your employer. It is where you make repayments on a vehicle with your pre-tax salary, meaning you actually reduce your taxable income. Plus, repayments don’t always only cover the cost of the car itself, they can also contribute to the running costs too like fuel, maintenance or insurance. 
  • Car lease: This is where you don’t own the car but instead make payments in order to use it. In some cases, monthly lease repayments tend to be cheaper than car loan repayments and come with maintenance packages to cover the upkeep of the car. However, the restriction is that because you don’t own the car, you may face restrictions (like a limited amount of kms over time) and it may end up being more costly over time. 

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Toyota finance features to look for 

Whether you opt to borrow from a bank, credit union, online lender or from a Toyota dealership, there are a few products to choose from. And each of those products have a bunch of features you should familiarise yourself with. 

Here’s a breakdown of what’s on offer:

Interest ratesThis is the headline rate that is attached to the loan and what you pay your lender in return for borrowing the money from them.
Comparison rateUnlike the headline rate, this rate encompasses the fees as well to give customers a rounded view of how much the loan could cost. When weighing up different loan options it is important to refer to the comparison rate.
FeesAnywhere from annual fees and monthly service fees to exit, early repayment or late charges, you’re likely to face additional costs on your Toyota finance. Aim to secure a loan option that has as minimal fees as possible.
Loan termRanging from 1 up to 7 or 10 years, it all depends on how much you want to borrow and how long you think you need to pay it back. Remember, the longer the loan term the more interest you pay.
Repayment scheduleGenerally the choice between weekly, fortnightly or monthly repayments, choose a repayment schedule that aligns with when your salary comes in.
Flexible repaymentsThis includes features like free extra repayments and a redraw facility. These allow you to make additional contributions on top of your regular repayments plus access that money later if you need to. Just bear in mind, some loans charge an early repayment penalty if you pay off your loan in full ahead of time.

How much Toyota finance will cost 

With Toyota there are plenty of vehicle options. So, depending on whether you go top or bottom of the line, this will determine the overall cost of your Toyota finance (along with things like interest rates and fees).

Figuring out how much your regular repayment can be tricky ahead of time, especially if you’re not a maths whiz. But we’ve got you covered, check out the Mozo Car Loan Repayment Calculator.

What you need to finance a Toyota 

Once you’ve found the right Toyota finance option for you, your job is almost done! There are just a few things you need to remember when applying. 

While each loan will have its own set of requirements, here are some things that you could come across. 

To qualify for Toyota finance: 

  • 18 years or older 
  • Good credit history 
  • Meet certain income requirements 
  • Australian permanent resident or citizen. 

To apply for Toyota finance: 

  • Personal Identification: driver’s licence, passport, medicare etc.  
  • Financial info: bank statement, credit history  
  • Vehicle info: make, model, year etc.  

Want to take a look at some car loan options to finance your new Toyota? Jump over to our car loan comparison page.

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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.