refinance car loans

Refinance Car Loans

Refinancing your car loan could be the easiest way to cut down the time it takes to pay off your loan, not to mention help you pocket hundreds if not thousands of dollars in savings in the process. See for yourself how much you could save by using our car loan comparison table below to plug in how much you want to borrow, over how many years, to compare the interest rates and monthly repayments available from different lenders.

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Refinance car loan comparisons on Mozo - last updated 18 May 2022

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  • New Car Loan - Prime Special

    Home Owner Discount, Including Demo, Variable, Secured

    Interest rate
    comparison rate
    Monthly repayment
    3.24% p.a.
    3.53% p.a.based on $30,000
    over 5 years

    Low variable car loan rate for purchasing new and demo vehicles from dealers. Extra low 2.99% rate (3.53 comparison rate*) for qualifying homeowners. Personalised loan amounts between $5,000 and $100,000. Flexible repayment options. Choose between the 3 to 5 year loan terms.

    Repayment terms from 3 years to 5 years. Representative example: a 5 year $30,000 loan at 3.24% would cost $32,935.97 including fees.

    Compare
    Details
  • Car Loan

    Fixed, Secured

    Interest rate
    comparison rate
    Monthly repayment
    5.35% p.a.
    5.65% p.a.based on $30,000
    over 5 years

    Available for all New and Used cars up to 7 years. A quick and easy, 100% online application with loans up to $75,000. No printing. No paper. No fuss. No monthly account keeping fees, no exit fees and no early repayment fees.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 5.35% would cost $34,507.61 including fees.

    Compare
    Details
  • Used Car Loan

    Fixed, Secured

    Interest rate
    comparison rate
    Monthly repayment
    6.24% p.a.
    6.94% p.a.based on $30,000
    over 5 years

    Enjoy a quick application process and no monthly fees on NRMA used car loans. Finance also available motorcycles, caravans and motorhomes. Low fixed interest rates with terms of up to seven years. Plus, NRMA Blue Member benefits apply so you could enjoy even lower rates as an NRMA Member**.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.24% would cost $35,499.27 including fees.

    Compare
    Details
  • Car Loan

    Fixed

    Interest rate
    comparison rate
    Monthly repayment
    5.99% p.a.to 10.29% p.a.
    6.54% p.a.to 10.86% p.a.based on $30,000
    over 5 years

    Enjoy competitively low rate car loans from 4.89% (comparison rate 5.44% p.a.) between $10,000 and $100,000 for new, demo and used vehicles. Take advantage of flexible 3, 5 or 7 year loan terms. No early repayment or exit fees. You must be 21 years or over to qualify and earn above $35,000.

    Repayment terms from 3 years to 7 years. Representative example: a 5 year $30,000 loan at 5.99% would cost $35,189.67 including fees.

    Compare
    Details
  • Clean Green Car Loan

    New or Used, Fixed, Secured

    Interest rate
    comparison rate
    Monthly repayment
    5.89% p.a.
    6.44% p.a.based on $30,000
    over 5 years

    No monthly or ongoing fees. Get a 0.70% discount on your car loan interest rate if you buy a qualifying green car. Winner of Mozo's Experts Choice Green Car Loan 2021 award^.

    Repayment terms from 3 years to 5 years. Representative example: a 5 year $30,000 loan at 5.89% would cost $35,107.05 including fees.

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    Details
  • Used Car Loan

    Dealer Only, Up to 5 years old, Fixed, Secured

    Interest rate
    comparison rate
    Monthly repayment
    6.59% p.a.
    7.14% p.a.based on $30,000
    over 5 years

    Used Car Loan with no monthly or ongoing fees, with a fixed rate for the life of the loan. Fast online application.

    Repayment terms from 3 years to 5 years. Representative example: a 5 year $30,000 loan at 6.59% would cost $35,695.00 including fees.

    Compare
    Details
  • Car Loan

    Up to 5 years old, Fixed, Secured

    Interest rate
    comparison rate
    Monthly repayment
    4.89% p.a.
    5.53% p.a.based on $30,000
    over 5 years

    Purchase or refinance a new or used vehicle, up to five years old. Choose a loan term from one to seven years. To be eligible you must be over 18, receiving a regular income and an Australian resident.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 4.89% would cost $34,377.58 including fees.

    Compare
    Details
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FAQ

Car loan refinancing, all you need to know

While your car loan may only run over a couple of years, that doesn’t mean you shouldn’t take the chance to compare some of the best car loan rates around and potentially make the switch to a better value deal. Refinancing is that easy. It’s simply making the move from one car loan to another and hopefully saving you some money along the way. It might seem like a hassle, but with our handy car loan comparison table you’ll be able to compare some of the lowest car loan rates around with a single glance, to see just how much you could save.

What should I consider before refinancing?

With plenty of low car loan rates on the market below 6.50%, now could be the time to do a rate check with your own car loan rate. But hold up one minute! Before you start the process of refinancing and making the switch, make sure you consider any fees you’ll need to pay. It can also be worthwhile weighing up whether car loan refinancing is the most convenient option for you to take. After all, making the switch might not be worthwhile if you’re already four years through a five year loan.

So if you’re considering refinancing your car loan, make it easy for yourself by using our handy car loan switch and save calculator. By plugging in a few simple details about your current loan and provider, our calculator will be able to show you just how much you could save on your car loan repayments if you were to refinance.

Just how much would refinancing save me?

Every car owner with a loan is going to be in a different situation when it comes to how much they’ll be able to save by refinancing. It may even be the case that you won’t be able to save at all because you’ve already bagged yourself one of the best car loan rates around. But in case you haven’t, here’s an example to illustrate the benefits refinancing your car loan could have on your wallet.

Two years ago, Emma and her partner purchased a second-hand 2015 Mitsubishi ASX. In order to buy it, they took out a car loan with an interest rate of 8.21% on which they still have $20,000 left to pay. Even taking into account a $200 upfront fee, if Emma made the switch to a low rate car loan with an interest rate of 6.50% she would end up saving $365 over the final three years of her loan.

Interested in finding out how much you could end up pocketing yourself by refinancing? Enter your current car loan figures into the Mozo car loan switch and save calculator to get started.

How soon should I refinance? 

When determining the right time to refinance, it’s a good idea to consider your car loan term length - specifically, how much of the term you have left - as this can help you decide whether refinancing is worth the time, effort and potential cost. 

For instance, if you only have one year of your loan term left, then refinancing may end up costing you more in fees than if you just chose to stick with your last year of repayments. But if you’ll be on a less competitive deal for a number of years before you finish paying off the car loan, then refinancing may be a good option and help you save hundreds of dollars.

What documents do I need to refinance?

Because you’ll be switching lenders when you refinance your car loan, you’ll need to have a few documents ready to go in order for the approval process to run quickly and smoothly.

  • Identification: Whether it’s your car loan or credit card, with any financial application you make you’ll need to prove that you are who you say you are. That’s why you should have some sort of identification, like a drivers licence, passport or your medicare card, at the ready when you’re looking to refinance to a new car loan. 
  • Address: Aside from your identity, your new lender is also likely to ask you to provide proof of your address. If you own your own home then a mortgage statement will do the trick, while if you’re renting you’ll need to fish out your tenancy agreement or even a bill or council notice with your address on it.
  • Finances: You’re taking out a loan after all, so you’re going to need to provide your new lender with some proof that you’ll be able to pay them back. This means offering up something like a payslip, or series of payslips, to show your ongoing income, as well as a savings account statement from your bank to demonstrate proof of savings. Your new lender may also ask you to provide records of any debt you currently owe.
  • Insurance: Depending on the lender, you may also need to provide proof that you have a comprehensive car insurance policy on the vehicle which you’re seeking the car loan for.

Are there any catches to refinancing?

Of course. Sometimes the car loan rate you’re currently getting could be very competitive, or it might just not be convenient for you to make the switch if you’re at the end of your loan period.

On top of rates and convenience, you’ll also need to factor in any exit, sign up or ongoing fees you’ll need to pay if you switch from one loan to another. Not all car loan providers charge fees, but for those that do, you could be looking at hundreds of dollars in costs. For example, car loan sign up fees in the Mozo database range anywhere from $0 to $995.

That said, some lenders do make special offers from time to time to waive some of those fees, so it’s always smart to keep an eye out for any promotions out there. 

Another thing to bear in mind before refinancing is that every time you apply for credit, including a car loan, you rack up what’s known as a ‘hard enquiry’. While you won’t need to fuss over one or two hard enquiries on your credit file, it’s when you make too many that this can become an issue, as it makes lenders think you’re financially careless and desperate for credit. In other words, refinancing your car loan too often may land you in trouble when you’re trying to secure other loans down the track, say, a home loan or a personal loan.

Does my car value matter when I’m refinancing? 

Yes, it does, and the reason stems from the fact that cars generally depreciate over time - that is, the moment you’ve paid for your car, it starts to lose its value. If you’re thinking of refinancing but your car has depreciated to a point that it’s worth less than the amount you still owe your lender, then it’s likely you’ll be considered a much riskier borrower, which would make switching to a better deal harder. 

So if you’re looking to boost your chances of getting a refinance, check to see what your car is valued at right now and make sure that it’s higher than your outstanding loan amount. 

Can I refinance a car loan with bad credit? 

While it can be a lot harder to refinance a car loan while you have a bad credit score, you won’t be completely shut from all options. For instance, if you’ve made every repayment in full and on time since taking out the bad credit loan, then your credit score may have actually improved, which means you already stand a better chance of being able to refinance. That’s because lenders would view an improved credit score more favourably (since it shows that you’ve become a lower risk borrower), making it easier for you to switch to a more competitive deal with a new provider. 

But if you’ve been having trouble keeping afloat every month, then it may be wise to spend some time adjusting your budget to ensure you can meet your repayments before trying to refinance.

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JP Pelosi
Managing editor

Jean-Paul (JP) Pelosi is an experienced journalist and editor who has contributed to many of Australia's leading media outlets including The Guardian, News.com.au, Domain.com.au, Investment Magazine and ANZ's Bluenotes. He has also edited news and communications for large financial services companies such as CommBank, Suncorp, Allianz and Amex. He loves a well told story and applying his editorial experience to content that readers both care about and enjoy. JP heads up our writing team.

More FAQs about car loans for refinancing

What is my choice of refinancing lenders?

If you do decide to refinance your car loan you’ll have plenty of choice when it comes to choosing a new lender. Some of the different types of lenders you can choose between include:

  • Online lenders: Many of the most competitive rates in the Mozo database are from online lenders or traditional lenders offering low rates for online loan deals. If you’re looking to refinance to a low rate deal and like the idea of a simple application process, an online car loan offer could be the right option for you.
  • Peer to peer lenders: Like the idea of online providers that reward borrowers with excellent credit history? Peer to peer lenders offer some of the most competitive car loan rates around for borrowers who have managed their credit well in the past.
  • Big banks: If you’d rather opt for a more familiar face, there are plenty of car loan rates on offer from the big four banks as well as other traditional lenders.

How else can I save on my car loan?

Aside from cutting down your repayments by refinancing to a cheap car loan, there are a couple of other tricks which could help you save money on your car loan.

  • Switch your repayment frequency: If you haven’t already, your first step should be switching your repayment frequency from monthly to fortnightly or weekly repayments. That’s if your car loan provider gives you the flexibility to do it. You won’t be paying any extra, but it’s a simple way to cut down the overall interest you’ll pay over the life of your loan. For example, let’s say you have a $25,000 car loan with an 8.21% interest rate. According to the Mozo car loan repayment calculator, by making weekly repayments instead of monthly ones, you could net an extra $106 in your pocket in saved interest over the life of a five year loan.
  • Make extra contributions: The vast majority of lenders will allow you to make extra repayments on your car loan, so if you’ve got the room in your budget, or you get a sudden windfall, it makes sense to pay off your debt as soon as possible. Just bear in mind that some lenders do charge a penalty if you pay off your loan earlier than anticipated, generally fixed rate loans, so be sure to check these details out beforehand. 

Can I use a car loan on a bike?

Short answer, most of the time. Car loans are just a different variety of personal loans and can be used for a wide variety of reasons. However there are occasions where you might want a more specific vehicle loan, whether this is a bike loan, a boat loan or something completely different.

What do I need to do to grab a better rate from the start?

If you’re sold by the idea of refinancing to a better car loan deal halfway through your loan, make sure you do the same when you're next on the market for a new or used car loan. Just imagine how much interest you could save by opting for a low rate car loan deal from the start.

But don’t stop there! If you’re set on refinancing to a better car loan rate, make sure you do the same for all of your banking products. Whether that’s making the move to a savings account with a more rewarding interest rate, or refinancing your home loan, comparing rates on all your products could be an easy way to save you money.

Car Loan Reviews

Pepper Money Secured Loan
Overall 1/10
Terrible Service, would never recommend.

Very difficult to deal with. Unreliable with debiting payments- they change dates randomly without notice. I am ahead on payments and yet they have taken extra payments randomly on more than one occasion- they admit to the mistakes but then don’t know how to fix it. This time they transferred me to 3 different people who all didn’t know. I felt they were just stalling hoping I would give up. Terrible service, looking forward to not using them in the future.

Read full review

Very difficult to deal with. Unreliable with debiting payments- they change dates randomly without notice. I am ahead on payments and yet they have taken extra payments randomly on more than one occasion- they admit to the mistakes but then don’t know how to fix it. This time they transferred me to 3 different people who all didn’t know. I felt they were just stalling hoping I would give up. Terrible service, looking forward to not using them in the future.

Price
1/10
Features
1/10
Customer service
1/10
Convenience
1/10
Trust
1/10
Less
Lauren, Queensland, reviewed 3 months ago
RAC Car Loan
Overall 1/10
Don't do it! Worst finance I have ever used!

Applied for a car loan, got it. The day I went to sign they advised me that they had made a mistake and my car was a couple of months out of their age limit, and I'd have to do a personal loan instead. I had already removed my plates ready for my trade in and arranged everything so I felt like I still had to go ahead. This is now costing me an extra $110 a fortnight and I am LIVID. I called them once to arrange a new direct debit date, and was told it was done but they didn't change it, so I was charged a fee for a failed direct debit and they repeatedly spam called me and emailed me being very rude. Absolute joke of a company- AVOID AVOID AVOID!!

Read full review

Applied for a car loan, got it. The day I went to sign they advised me that they had made a mistake and my car was a couple of months out of their age limit, and I'd have to do a personal loan instead. I had already removed my plates ready for my trade in and arranged everything so I felt like I still had to go ahead. This is now costing me an extra $110 a fortnight and I am LIVID. I called them once to arrange a new direct debit date, and was told it was done but they didn't change it, so I was charged a fee for a failed direct debit and they repeatedly spam called me and emailed me being very rude. Absolute joke of a company- AVOID AVOID AVOID!!

Price
1/10
Features
3/10
Customer service
1/10
Convenience
1/10
Trust
1/10
Less
Tash, Western Australia, reviewed 3 months ago
Pepper Money Car Loan
Overall 10/10
Overall fantastic service

Fantastic service….very quick decisions and extremely great customer service A+++++

Read full review

Fantastic service….very quick decisions and extremely great customer service A+++++

Price
10/10
Features
10/10
Customer service
10/10
Convenience
10/10
Trust
10/10
Less
Robert, Victoria, reviewed 3 months ago

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