As of 2021, Australia has 789 vehicles per 1000 people (Source: ABS), and the average age of vehicles in Australia was just over 10 years old.More and more Australians are looking for ways to finance their next vehicle purchase – whether it’s for a new car or a used car, a first car or a secondary car – there are many options available for us here in Australia – before you begin, here are 5 things to keep in mind when considering accessing a car loan to purchase a new or used car in Australia.
1 – Which car loan should I choose?
There are many options to choose from when it comes to deciding how you will fund your new car purchase – whether it is a brand new car or just new to you, the amount you wish to borrow and how you’d like to pay it back can be factors in your decision for which car loan you choose to apply for. It is recommended to compare more than one financing option and consider it carefully before making a final decision, many providers offer free calculators so you can have a view of what the loan would look like if you were to be approved.
2 – How much can I borrow?
The amount you can borrow for a car loan will depend on your individual circumstances, such as the type of car you are purchasing, your credit score, and which car loan provider and loan type works best for you.
3 – What other costs can be associated with purchasing a car using finance?
It is important to keep in mind the on-road costs associated with buying a car in Australia.
These include registration, transfer costs, stamp duty and insurance, along with the day-to-day running costs of fuel, maintenance and servicing. These costs are usually in addition to the advertised price for new and used cars, so it is important to confirm the details with the seller before settling on an amount you wish to borrow, and which product you will choose, as some types of loans in Australia have restrictions associated with how the funds are spent, and where they are deposited.
4 – Where can I access finance?
Some dealerships offer their own brand of finance, or can assist you in applying for a car loan with their chosen third-party loan provider – generally these types of finance can be less competitive than other similar options in the space, and may require you to secure the vehicle as collateral for the loan which can make it difficult to sell the car later on if you wish to upgrade. You can also consider your options with your bank or an alternate credit provider of your choice if they have a suitable loan product available that you meet the requirements for.
5 – What if I have bad credit rating or a low credit score – Can I still get a car loan?
Your individual circumstances are a major factor in the process for applying for a car loan – all loan types require the loan provider to assess your circumstances before approving you for finance. The assessment will usually cover your personal details, living situation, income and expenditure, and a review of your banking history and credit file. Having bad credit doesn’t necessarily mean that you won’t be able to obtain a car loan, but it can be a limiting factor for the type of loan product and the amount you are able to access. Some lenders have options available for individuals who have low or poor credit scores and there are even some loan providers who are able to lend to you with no credit checks, like Fundo!
Keep these key factors in mind when looking to enter into a car loan so you can be sure to make the choice that best fits your needs
If you are ready to get started, visit our website https://fundo.com.au/ to access our easy 3 minute application form!
FAQ
What is a Car Loan?
A Car Loan is a specific type of personal loan which can be secured or unsecured depending on the provider and the amount you need to borrow. Fundo offers unsecured loans of up to $2000 with a FAST application, FAST approval and FAST funds to your account!
How do Car Loans work?
Car loans in Australia can be secured or unsecured. The main difference between these two types of personal loan, or car loan, is that a secured loan requires you to put up an asset as collateral. For example, if you were to purchase a brand new car at the dealership, this is a typical loan type you may be offered. If you choose this loan type to purchase your car, in the event that you fail to make your repayments your lender would have the right to repossess your vehicle to recover the amount they loaned, and have a registered interest on the vehicle, which could present an issue down the track if you wished to sell or trade in your car after a few years time.
Unsecured loans, which is what we offer at Fundo, do not require you to put up an asset as collateral, however without assets attached to the loan, the interest rates can be at a higher rate due to the higher risk.
The loan product that you choose will determine how that particular product works. If you are in need of fast cash and wish to access a short term loan of up to $2000 – a car loan with Fundo is the way to go!
Can you get a Car Loan with Bad Credit?
Each individual has different needs. Two people can have the same problem, but require different solutions due to their personal circumstances. Some lenders are not able to offer finance for individuals that have what is considered bad credit or a low credit score. At Fundo, we are certainly able to consider applications from customers with bad credit – we even offer a no credit check loan so you can breathe easy knowing that we genuinely consider your overall situation and circumstances, and not just your credit score. We understand that sometimes everyone needs a little bit of help!
How quickly can I be approved for a Car Loan?
Depending on the provider, some car loan providers are able to assist you at the dealership on the spot, however if you are purchasing privately or secondhand, that option may not be available to you, so you might prefer an online lender than can deposit the funds to your account so you can facilitate your purchase. Fundo can offer approval and funds deposited within 1 hour of successfully submitting an application
Can I repay my car loan early?
Yes, however some Car Loan products are not designed to be paid out early, and can have huge fees applied for early payouts. If you are considering paying off your car loan in a sooner term than offered, it is best to confirm this with your provider. For all Fundo loans, including a loan for a car, you can pay it out early and be rewarded with discounts on interest, and an increase in your Fundo Credit Score!
How long does it take to repay a car loan?
The length of a Car Loan can depend on the amount that you have borrowed along with the provider and product you have selected. Fundo Loans are repaid over up to 20 weeks, and can be paid out early without penalty for doing so!
Disclaimer: The opinions expressed in the Blog are for general informational and entertainment purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific investment product. It is only intended to provide education about the financial industry. The views reflected in the commentary are subject to change at any time without notice.