Don’t get taken for a ride on your car loan

By Polly Fleeting · · 2 min read
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woman in her car holding the keys out the window

Choosing the right car loan can be tricky to navigate. From interest rates and fees to selecting the perfect loan term, there's a lot to think about.  

So no matter if you opt to borrow from a traditional bank or an online lender, there are a bunch of dos and don'ts on getting a car loan you should know about, to avoid being taken for a ride. 

Read on to find out Mozo’s expert car loan tips and compare top car loan deals on offer right now… 

Car loan dos: 

  • Compare car loan interest rates: By weighing up your options across a number of lenders you give yourself a good chance of snagging a deal. Also remember, some lenders offer tiered rates that reward customers for having a good credit rating. 
  • Look beyond the big banks: Right now, the lowest car loan rate from the big four on the Mozo database starts with the number 6, meanwhile the lowest car loan rate from a smaller lender starts with the number 3. However, it’s still important to weigh up all your options to ensure the product you choose is suitable for you. 
  • Make sure you can make extra repayments at no extra cost: It’s always a good idea to take out a loan that allows you to make free extra repayments whenever you can, should you have some extra cash. Just be mindful, some loans come with early repayment penalties if you pay your entire loan off ahead of time. 

Car loan don’ts: 

  • Beware of introductory car loan rates: Some car loans advertise a low intro rate, but keep in mind that after a period of time this rate will be hiked up, meaning so will your interest repayments. 
  • Watch out for multiple fees: While an application fee, a monthly charge and early repayment penalty may seem like small costs separately, when added up they could end up costing you thousands. For example, a $10 monthly fee might not sound like much but over a 5-year loan you’d end up $600 out of pocket on top of the interest you pay and any other fees. 
  • Remember, the longer the loan the more interest you pay: If you can and if it's feasible for you, opt for a shorter loan term. While your regular repayments may be higher it’ll save you in the long run as it means you’ll fork out less in interest. Just remember, only opt for this if you can afford a shorter term without compromising your everyday finances.

LOW RATE CAR LOANS MAY 2021

Mozo may receive payment if you click the products below. We don’t compare the entire market, but you can search our database of 91 car loans.
Last updated 16 October 2024 Important disclosures and comparison rate warning*
  • Used Car Loan

    Fixed, Secured, No vehicle age limit

    Interest rate
    comparison rate
    Monthly repayment
    6.57% p.a.to 18.99% p.a.
    7.19% p.a.to 21.78% p.a.based on $30,000
    over 5 years

    Get a competitive fixed interest rate on a secured used car loan of up to $75,000 depending on your credit score. No vehicle age limits. Easy online application. Fast pre-approval. Pre-approved funds held for up to 3 months. No monthly account keeping fees, no exit fees and no early repayment fees. Flexible weekly, fortnightly or monthly repayments on terms from 1 to 7 years.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.57% would cost $35,528.12 including fees.

    Compare
    Go to site
    Details
  • New Car Loan

    Fixed, Secured

    Interest rate
    comparison rate
    Monthly repayment
    6.57% p.a.to 18.99% p.a.
    7.19% p.a.to 21.78% p.a.based on $30,000
    over 5 years

    Get a competitive fixed interest rate on a secured new car loan of up to $75,000 depending on your credit score. Easy online application. Fast pre-approval. Pre-approved funds held for up to 3 months. No monthly account keeping fees, no exit fees and no early repayment fees. Flexible weekly, fortnightly or monthly repayments on terms from 1 to 7 years.

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.57% would cost $35,528.12 including fees.

    Compare
    Go to site
    Details
  • Any Age Car Loan

    Variable, Secured

    Interest rate
    comparison rate
    Monthly repayment
    10.69% p.a.
    10.97% p.a.based on $30,000
    over 5 years

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 10.69% would cost $39,053.66 including fees.

    Compare
    Find out more
    Details
  • Car Loan

    Variable, Secured

    Interest rate
    comparison rate
    Monthly repayment
    9.99% p.a.
    10.21% p.a.based on $30,000
    over 5 years

    Repayment terms from 1 year to 6 years. Representative example: a 5 year $30,000 loan at 9.99% would cost $38,385.82 including fees.

    Compare
    Find out more
    Details
  • Used Car - Unsecured Personal Loan

    Interest rate
    comparison rate
    Monthly repayment
    6.99% p.a.to 24.99% p.a.
    6.99% p.a.to 22.79% p.a.based on $30,000
    over 5 years

    Repayment terms from 1 year to 7 years. Representative example: a 5 year $30,000 loan at 6.99% would cost $36,132.67 including fees.

    Compare
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    Details

* WARNING: The Comparison Rate combines the lender's interest rate, fees and charges into a single rate to show the true cost of a personal loan. The comparison rates displayed are calculated based on a loan of $30,000 for a term of 5 years or a loan of $10,000 for a term of 3 years as indicated, based on monthly principal and interest repayments, on a secured basis for secured loans and an unsecured basis for unsecured loans. This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

^See information about the Mozo Experts Choice Personal Loan Awards

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While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.