New Car Finance

What is new car finance?

New car finance is a loan used to buy a brand-new vehicle. The lender provides funds to purchase the car, and the borrower repays the amount over an agreed term, usually with interest and fees. The vehicle is often used as security for the loan.

Common types of new car finance

• Secured car loan — the vehicle is used as security, which may mean a lower interest rate.
• Unsecured personal loan — not tied to the vehicle, but rates may be higher.
• Novated lease — a salary-sacrifice arrangement often used by employees.
• Chattel mortgage — a business loan structure where the borrower owns the vehicle.

What lenders typically look at

Things to compare

When comparing new car finance options, people often look at the interest rate, comparison rate, fees, loan term, repayment frequency, and flexibility such as the ability to make extra repayments or repay the loan early. Each lender sets its own criteria and pricing.

Dealer finance vs. using a broker

Car dealers may offer finance at the point of sale. A finance broker or specialist can compare products from multiple lenders. Both paths have different processes and costs, so it can be worth understanding what each option offers before deciding.