Should I get a new or used car?

As with any large purchase, it's important to compare your options. You should choose a car based on the features you want, and then pick one in your budget. There are benefits and drawbacks to both new and used car purchases, for instance, used cars can be a bargain but can come with unknown mechanical problems, while new cars come with a factory warranty but depreciate quickly. Take a look at our used car buying guide here to get an idea of what might be in store.

How do I apply for a pre-approved car loan?

Apply online to see if you qualify for a pre-approved car loan. You can compare your options using the table on this page and click 'apply' once you've found the right loan for you. Keep information handy such as your income, employment details, other income, assets, liabilities and 100 points of ID. Applying has never been easier, with some lenders granting pre-approval within 60 seconds.

Are there any extra costs I should be worried about?

Stamp Duty. The government requires you to pay stamp duty on your car which will be a percentage of the purchase price. Compulsory Third Party Insurance . This is a legal requirement in Australia and covers anyone who may get hurt as a result of your driving. Ongoing costs. You'll have to pay for the ongoing upkeep of your next car including servicing, tolls, etc.

Where can I buy cars if I have pre-approval?

Pre-approved car loans are no different to other car loans. You can use one to purchase a car through a dealership, at private sales and at auction.

Who can actually get pre-approval?

Depending on who you bank with you may already have pre-approval. Compare the lenders above to find out. You'll have to be 18+ and a permanent resident or citizen, have a job and a regular income and be able to afford your loan repayments.

Pre-approved car loans: How to get conditional approval

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Name	Interest Rate (p.a.)	Comp. Rate (p.a.)	Application Fee	Monthly Fee	Monthly Repayment
loans.com.au - New/Demo - Variable Rate Variable3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 5.99% to 7.14%	Comp. Rate (p.a.) 7.12% to 8.27%	Application Fee $400	Monthly Fee $8	Monthly Repayment $628.52	Go to site More info Compare
IMB New Car Loan Fixed1 - 7 Years $2,000 - $125,000	Interest Rate (p.a.) 6.24%	Comp. Rate (p.a.) 6.59%	Application Fee $274.78	Monthly Fee $0	Monthly Repayment $619.01	Go to site More info Compare
OurMoneyMarket New Car Loan ($5,000-$100,000) Fixed1 - 7 Years $5,000 - $100,000	Interest Rate (p.a.) 6.57% to 18.99%	Comp. Rate (p.a.) 7.19% to 21.78%	Application Fee 1.5% - 6%	Monthly Fee $0	Monthly Repayment $622.82	Go to site More info Compare
Stratton Finance New Car Loan Fixed1 - 7 Years $10,000 - $300,000	Interest Rate (p.a.) 5.9% to 18%	Comp. Rate (p.a.) 6.33% to 23%	Application Fee $395	Monthly Fee $0	Monthly Repayment $619.53	Go to site More info Compare
RACV New Car Loans Fixed1 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 6.99% to 17.99%	Comp. Rate (p.a.) 7.69% to 18.77%	Application Fee $499	Monthly Fee $0	Monthly Repayment $632.86	Go to site More info Compare
OurMoneyMarket Used Car Loan ($5,000-$100,000) Fixed1 - 7 Years $5,000 - $100,000	Interest Rate (p.a.) 6.57% to 18.99%	Comp. Rate (p.a.) 7.19% to 21.78%	Application Fee 1.5% - 6%	Monthly Fee $0	Monthly Repayment $622.82	Go to site More info Compare
Stratton Finance Used Car Loan Fixed1 - 7 Years $10,000 - $300,000	Interest Rate (p.a.) 6.59% to 18%	Comp. Rate (p.a.) 7.91% to 23%	Application Fee $395	Monthly Fee $0	Monthly Repayment $625.92	Go to site More info Compare
loans.com.au - Variable Rate Used Car < 5 years Variable3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 7.14% to 7.14%	Comp. Rate (p.a.) 8.27% to 8.41%	Application Fee $400	Monthly Fee $8	Monthly Repayment $639.2	Go to site More info Compare
RACV Used Car Loans Fixed1 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 8.19% to 17.99%	Comp. Rate (p.a.) 8.9% to 18.77%	Application Fee $499	Monthly Fee $0	Monthly Repayment $644.16	Go to site More info Compare
loans.com.au - New/Demo - Fixed Rate Fixed3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 6.59% to 7.79%	Comp. Rate (p.a.) 7.72% to 8.92%	Application Fee $400	Monthly Fee $8	Monthly Repayment $634.08	More info Compare
loans.com.au - Variable Rate Used Car < 3 years Variable3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 7.14% to 7.14%	Comp. Rate (p.a.) 8.27% to 8.41%	Application Fee $400	Monthly Fee $8	Monthly Repayment $639.2	Go to site More info Compare
loans.com.au - Fixed Rate Used Car Loan (6 to 7 years) Fixed3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 8.69% to 9.89%	Comp. Rate (p.a.) 9.82% to 11.16%	Application Fee $400	Monthly Fee $8	Monthly Repayment $653.78	More info Compare
loans.com.au - Fixed Rate Used Car Loan (8+ years) Fixed3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 12.39% to 13.59%	Comp. Rate (p.a.) 13.51% to 14.86%	Application Fee $400	Monthly Fee $8	Monthly Repayment $689.38	More info Compare
loans.com.au - Variable Rate Used Car Loan (6 to 7 years) Variable3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 7.14%	Comp. Rate (p.a.) 8.27%	Application Fee $400	Monthly Fee $8	Monthly Repayment $639.2	More info Compare
loans.com.au - Variable Rate Used Car Loan (8+ years) Variable3 - 7 Years $5,000 - $150,000	Interest Rate (p.a.) 12.09%	Comp. Rate (p.a.) 13.2%	Application Fee $400	Monthly Fee $8	Monthly Repayment $686.45	More info Compare
Driva Car Loan Fixed or Variable1 - 7 Years $2,001 - $300,000	Interest Rate (p.a.) 6.57% to 36%	Comp. Rate (p.a.) 6.78% to 36%	Application Fee $0 - $500	Monthly Fee $0	Monthly Repayment $613.62	More info Compare

Showing 16 of 16 results

Getting pre-approved for a car loan means the lender looks at your finances and gives you a conditional loan amount, so you know your budget before shopping.
Pre-approval doesn't guarantee final approval - the lender will check the car details and your financial situation again before confirming the loan.
Pre-approval usually lasts up to three months, so make sure to buy your car within that time or you might need to apply again.

What is conditional approval?

Most car buyers find the right car first then apply for a car loan. But with pre-approval you can do it the other way round. You submit an application and the lender offers you a conditionally approved loan. Then you look for a car.

It's not the same as a full approval (you might get knocked back when you actually apply) but pre-approval gives you a decent idea of how much you can borrow and what it will cost you. That way you can shop for a car with more confidence.

The ins and outs of pre-approved car finance

When you apply for pre-approval, the lender will determine how much you can afford to borrow based on your income, expenses, the amount you wish to borrow and the type of car you're looking to buy.

Why pre-approval is useful

Buyer confidence. Pre-approved car loans give buyers confidence that they have a good chance of getting finance for their chosen car.
Understanding of your financial situation. The lender has already assessed your financials and has confirmed that you can afford the loan and therefore the car purchase, before you go out and buy it.
Bargaining power. Pre-approval can give you the upper hand when negotiating your price at the car dealership. You know how much you can spend, so you can make an offer there and then.

Drawbacks of car loan pre-approval

Shorter periods of time. Conditional approval on some loans is only available for short periods of time (typically up to 3 months). After that you'll need to apply for pre-approval again or apply for a loan.
Limited choice. Not every car lender offers pre-approval.

Finder survey: Have Australians of different ages ever had a car loan application rejected?

Response	Gen Z	Gen Y	Gen X	Baby Boomers
No	55.06%	64.95%	70.72%	70.74%
I have never applied for a car loan	37.08%	25.27%	24.01%	28.69%
Yes	7.87%	9.78%	5.26%	0.57%

Source: Finder survey by Pure Profile of 1113 Australians, December 2023

How to get pre-approved for a car loan

Ensure you have all your documents and pay slips ready.
Compare a range of loans that you can apply for.
Contact your bank or financial provider you wish to apply with.
Get pre-approved by the lender.
Shop around for your car.

Note that not every lender offers pre-approval for a car loan. Some lenders simply require an application once you're ready to buy a car.

And many lenders can turn around loan applications quite quickly, which can be very useful if you don't have pre-approval.

Things to consider before applying for pre-approval

There's probably a few things you should do before buying a car, and these will vary from person to person. Here's a few things to keep in mind.

Research your car. The make. The model. The year. The colour. You'll also need to take into consideration the fuel consumption.
Check your financial standing. Car loans are an extensive financial commitment. Ensure that you have the required funds and/or pre-approval.
Test-drive your car. Taking the car for a test-drive will let you find out if there is any issues with it.
Shop around. Go to a few dealers or multiple private sellers. Don't buy the first car you see.

Frequently asked questions about pre-approved car loans

As with any large purchase, it's important to compare your options. You should choose a car based on the features you want, and then pick one in your budget. There are benefits and drawbacks to both new and used car purchases, for instance, used cars can be a bargain but can come with unknown mechanical problems, while new cars come with a factory warranty but depreciate quickly.
Take a look at our used car buying guide here to get an idea of what might be in store.
Apply online to see if you qualify for a pre-approved car loan. You can compare your options using the table on this page and click 'apply' once you've found the right loan for you. Keep information handy such as your income, employment details, other income, assets, liabilities and 100 points of ID. Applying has never been easier, with some lenders granting pre-approval within 60 seconds.
- Stamp Duty. The government requires you to pay stamp duty on your car which will be a percentage of the purchase price.
- Compulsory Third Party Insurance. This is a legal requirement in Australia and covers anyone who may get hurt as a result of your driving.
- Ongoing costs. You'll have to pay for the ongoing upkeep of your next car including servicing, tolls, etc.

Thank you for your feedback!

Written by

Richard Whitten

Money Editor

Richard Whitten is Finder’s Money Editor, with over seven years of experience in home loans, property and personal finance. His insights appear in top media outlets like Yahoo Finance, Money Magazine, and the Herald Sun, and he frequently offers expert commentary on television and radio, helping Australians navigate mortgages and property ownership. Richard holds multiple industry certifications, including a Certificate IV in Mortgage Broking (RG 206) and Tier 1 and Tier 2 certifications (RG 146), as well as a Graduate Certificate in Communications from Deakin University. See full bio

Richard's expertise

Richard has written 609 Finder guides across topics including:

Home loans
Property
Personal finance
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8 Responses

JohnJuly 19, 2017

I hold a provisional resident visa (subclass 309) pending my permanent residency which is sooner. I have lived in Sydney for 1 year and 7 months. There is no restriction on my visa, and I have been working as a part time permanent for a year plus now. Am I eligible for Car Loan from any Bank?

Finder

RenchJuly 27, 2017Finder

Hi Dennis,

Thank you for your inquiry.
Please note that we are not affiliated with any company we feature on our site and so we can only offer you general advice.

Here are some steps for you to get a pre -approved Car Loan:

-Get a copy of your credit score
-Ensure you have all your documents and pay slips
-Compare a range of loans that you can apply for
-Contact your bank or financial provider you wish to apply with
Shop around for your next car

Before applying for any loan, please ensure that you meet the eligibility criteria and requirements of the loan option or lender and make sure to read the details, as well as the relevant PDS/ T&Cs of the loan option before making a decision and consider whether the product or option is right for you.

Please contact your preferred lender to inquire. You may click the ‘Go to Site’ button to submit an online application.

Best regards,
Rench

SharonJuly 16, 2016

I have been pre approved for a car loan and went and found a car I liked today, and my bank said to make sure it was subject to finance which I did , do I let my bank know all the cars details and dealer details or does the dealer do that on my behalf

Finder

ElizabethJuly 18, 2016Finder

Hi Sharon,

You’ll need to advise the dealer that you’ve got a pre-approved car loan, but then you’ll need to give the details of the vehicle to the bank yourself. Following this the bank will pay the money to the dealership on your behalf.

I hope this helps,

Elizabeth

richardJanuary 20, 2016

sir I have a 2011 buick lacrosse that I want to trade in for a 2016acura rdx so how does a pre approval work in this case . I owe approx. 8000$ on it

Finder

ElizabethJanuary 21, 2016Finder

Hi Richard,

Pre-approval works depending on the lender you apply with, but this will be considered a refinancing loan. You can compare lenders using the table above and once you’ve found a lender you want to enquire with you can click through to its website. You can then find out the process and if the car is eligible for refinancing. You may also want to consider the services of a car loan broker which you can do on the table above.

I hope this has helped.

Thanks,

Elizabeth

KarinaJuly 12, 2014

Can you get a loan while being unemployed? Do car loaning places accept your application if your partner or parent is willing to pay your car loan until you get a job?

Finder

ShirleyJuly 14, 2014Finder

Hi Karina,

Thanks for your question.

When considering your application, most lenders will need to see proof of income before accepting your loan. Some lenders will allow a guarantor, but it’s best to do some research and speak to relevant the lenders before you apply to discuss your eligibility.

Cheers,
Shirley

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Know your budget before the car sales pitch gets awkward. Compare car loans with pre-approval before you shop.