Car Loan Interest Rates Bad Credit
Want a car but have bad credit? We connect you to lenders offering car finance with fixed interest rates to take the fuss out of applying today.
Features and benefits of bad credit car loans
You’ll be protected from rate rises and have the peace of mind of predictable repayments on a fixed interest rate.
Pay back your loan weekly, fortnightly or monthly: you get to choose in line with whichever is easiest when budgeting.
Everyone has to start their credit journey somewhere. If you’re a first-time borrower with little or no credit history, you’re still able to apply.
Having the choice of new or used cars from private sellers or dealerships gives you the luxury of more options to choose from.
How fast you repay your loan is up to you, with term options between one and five years available to suit their needs.
Depending on your financial footing, you can be approved for loans from $5,000 up to a maximum of $100,000 in certain cases.
Fast loan approvals
Your consultant can have your application approved, signed and funded in as little as 48 hours.
Specialist lenders
By partnering with multiple lenders, we'll find a loan deal which best fits your own unique requirements.
Over ten years of experience
For more than a decade, we've helped thousands of borrowers with poor credit get approved for car loans.
How to apply for a loan
Multiple incomes accepted
You can count various income streams, such as multiple jobs and fixed government benefits, towards your car loan application.
Early repayment accepted
Making extra payments or paying off your loan early won't cost you, as some of our lenders don't charge early exit or discharge fees.
Fixed interest rate
Locking in an interest rate stabilises your repayments over the life of your loan and makes budgeting easier and more accurate.
Unpaid or paid defaults
If you have defaults on your credit report, you're still eligible to take out a car loan, regardless of whether they're paid.
New or used options
You can choose to buy brand-new or second-hand through a private seller or a dealership anywhere in the country.
Loan terms up to five years
Our lenders offer flexible loan terms, allowing you to pay across one to five years and structure repayments to your needs.
How to get the wheels in motion on your car loan application
Enquire online
Get a quote on our website in a couple of clicks. You have the chance to make an initial application as well, but if you're not quite ready, a consultant will call to discuss your options.
Get matched with a lender
When you apply, your consultant will connect you to a lender who best meets your financial situation using our high-tech software.
Get your application submitted
After locking in your lender, your consultant gets about preparing your application. You'll be asked to supply supporting documents.
Sign your documents
Once approved, your consultant emails you a loan agreement to sign and return so your loan funds can be released.
Top tips for getting the best rate
Pay your bills on time
You’re likely to get a better rate if you have a better recent credit history. Utility and telecommunication companies are often quick to add defaults to your credit file if you miss a payment, so paying by the due date is a good way to protect the health of your score.
Reduce some debt
Scaling back your credit card limits, cutting up cards you don’t need and paying off outstanding debts and defaults are all ways to increase your chances of getting a better rate.
Buy a newer car
Buying a newer model vehicle in good condition may help you get a better rate. The car acts as security over your loan, so your lender will be taking less of a risk if you own a vehicle of greater resale value.
Stick to a budget
Lenders want to know that you can afford your repayments and the loan you’re applying for won’t cause any financial stress. They may be able to offer a better interest deal if you’ve reduced your expenses and given yourself more breathing space in your budget.
Which factors can impact my interest rate?
While you won’t necessarily be able to get a bad credit car loan with low interest, many factors go into determining what your actual rate is. Consider some of the factors which can play a role in determining your rate:
Income
The more you earn, the better your chances of being offered a lower interest loan. Lenders assess your application based on how much of a risk you pose. If you have a higher salary, you’ll be seen as more capable of making the repayments, particularly if their cost is very affordable for you, and your risk profile drops. Also, showing a lender you have a strong employment history within your industry will improve your case.
Savings
When a lender looks over your finances, they’ll keep an eye out for consistent saving habits. This shows you’re not living pay cheque to pay cheque. Because of this, a lender may have more confidence in you making repayments and be able to offer you a better deal.
The age of your asset
The older your car is, the more it’s likely to cost in interest. As the vehicle is used as security against your loan, the lender is taking more of a risk if it’s racked up the kilometres on the odometer. Purchasing a factory-fresh vehicle or near-new second-hand in good condition will help you get a better rate.
The nature of your bad credit
The better shape your credit file is in, the better your borrowing rate is likely to be. A couple of defaults from late bill payments a few years ago will almost always attract lower rates than a recently discharged bankrupt, for instance. Paying off your defaults will improve your score. They’ll still be on your report, but they’ll be listed as ‘paid’ and will improve the health of your credit score.
How you apply
Leave the loan shopping to us. By putting your faith in us, your consultant matches you to the most suitable lender with the most competitive rate. Our consultants draw on relationships with lending partners to negotiate a better deal than you may be able to on your own.
Your car loan questions answered
How much can I borrow?
The more you earn, the more you’ll be able to borrow. As mentioned, loans start from $5,000, but lenders will assess a range of variables such as your income, expenses and debts when determining how much you can borrow.
What are the basic eligibility requirements?
To be considered for finance, you must be: Over 18 years old, A permanent Australian resident or citizen, Earning some form of income
What documentation do I need to supply?
You will need to supply the following paperwork when submitting a loan application: A driver’s licence (copy of front and back), A valid Australian or foreign-issued passport (if applicable), Two most recent payslips, Bank statements covering 90 days, A Centrelink income statement (if applicable), A recent tax return or an ATO Notice of Assessment completed within the last 18 months if you’re self-employed
Can I get a variable rate with bad credit car loans?
No – variable rates are only available on unsecured finance, such as personal loans, and all bad credit car loans come with fixed rates. Taking out a secured loan means you get better terms and easier repayments because your vehicle is used as security against the loan, reducing the risk felt by your lender.
Should I pay a deposit on my loan?
Making a down payment isn’t a requirement with these types of car loans. However, it can help you pay off your loan faster and cut back on the cost of your repayments. You’ll be less likely to attract a bad interest rate if you can put some skin in the game.
I’m an aged pensioner on Centrelink. Can I apply for a loan?
Yes – if your aged pension makes up a portion of your income, you can still apply. Our lenders factor in a range of ongoing and fixed government benefits when assessing your income. However, you may find your average interest rate is higher if you’re earning a lower income, although this varies depending on the applicant and the type of benefit received.
Can I apply if I’m a discharged bankrupt?
Yes – we partner with lenders who give ex-bankrupts a second chance at finance approval. They’ll focus on what you’re earning now, rather than your backstory.