Car Loan Comparison

Why compare car loans with Canstar?

No cost to you

Using our comparison tool to find a better deal is free. We may receive a commission from our online partners if you apply for a car loan you find on our site.

Expert research

Our team of car loan research experts crunch the numbers to rate car loans based on value (price as well as features) to help you compare. Read the car loans methodology.

A wide range of lenders

We rate and review personal loans from more than 65 brands which means you can compare and choose products from both large and challenger brands, established and new.

Easy to compare & apply

Our car loan comparison tool allows you to filter your search results so it’s easy to find the right product for you. What’s more, you can click straight through to many of our online partners, making it easy to apply instantly.

Better deals are found when you compare

Canstar helps millions of Australians each year compare and find better deals

Sally Tindall’s guide to comparing car loans

Car loan tips from our expert

Sally Tindall, Canstar Director of Data Insights

Your car loan rate matters

The interest rate you pay on your loan can make a huge difference to the cost of your monthly repayments and how much you end up paying over the life of the loan. Shop around for a competitive rate, but before you do, check your credit score. Many lenders now base their rates on an individual’s credit score, reserving the sharpest rates for those borrowers with the highest scores.

Read the fine print

Watch out for hidden or unusual fees. When shopping for a car loan, the comparison rate, which sits right next to the advertised rate, can be your friend. If a loan has a much higher comparison rate than the advertised one, stop and find out why.

Be organised and do your homework

Do your research, and don’t be afraid to ask questions. Consider getting pre-approval for your loan before you hit the car yards but know your upper limit, not the amount you must spend. It’s also worth understanding all the different terminologies. Do you want an unsecured loan or a secured one? A secured loan typically comes with a lower interest rate, but if you stop making repayments the lender could come knocking for the keys to your car.

What is a car loan?

A car loan is a type of personal loan used for buying a motor vehicle such as a car, ute, 4WD, motorbike or other road vehicle. If you need a vehicle but do not have enough savings to buy one upfront, a car loan can be a helpful form of finance, as long as you can afford the repayments.

You can take out a car loan to buy a new car or to get a used car. The lender may specify a maximum age that the vehicle can be to qualify for the loan.

There are two main types of car loans, secured car loans and unsecured car loans.

What is a secured car loan?

Most car loans are secured. With secured car loans, the loan will typically be secured by the vehicle you are buying. This means that the lender can repossess your car and sell it if you don’t repay the loan on time.

What is an unsecured car loan?

Some lenders offer unsecured car loans. These are mainly available for used cars and are not secured by any property. Unsecured car loans typically have higher interest rates than secured car loans. This is because there is a greater risk to the lender. If you fail to make repayments, there is no particular asset tied to the loan for them to repossess. Instead, a lender may choose to take a borrower to court if their repayments are not met.

You can consider different types of car loans using the comparison selector tool at the top of this page.

What are the pros and cons of car loans?

There are both pros and cons to car loans. While a car loan might enable you to buy a more expensive vehicle, and to balance repaying costs over a longer timeframe, you’ll usually need to pay interest, and there can be associated fees to consider. There are also the risks of repossession. Your credit score may also be impacted by you taking out a car loan.

What are the advantages of a car loan?

• A car loan may enable you to buy a more expensive car than what you might otherwise be able to afford if you paid for a car using cash upfront.
• A car loan is repaid over a fixed term, so you have a clear timeline for when you can repay the loan amount (provided you make your repayments and pay any additional fees on time).
• You typically have between one and seven years to repay the loan.
• If you choose a car loan with a fixed interest rate, the interest rate will stay the same during the loan, so you can budget how much you need to repay every month.
• If you take out a car loan and make the repayments consistently, there may be a favourable longer term impact on your credit score.

What are the disadvantages of a car loan?

• Car loans can come with various fees. For example, there may be establishment fees, service fees, late payment fees, extra repayment fees and early repayment fees.
• You must make your repayments or your lender could repossess your car (with a secured loan) or take you to court (with an unsecured loan).
• You will pay more than just the principal cost of a car if you take out a car loan. You’ll also usually need to pay interest, and this can add to the total cost of purchasing a car overall.
• If you take out a car loan and do not consistently make the repayments on time, there may be a negative effect overall on your credit score. This may, in turn, impact how lenders perceive you as a borrower for future requests for credit. If you have a low credit score, it can impact the interest rate you pay on personal and car loans.

Looking for the best car loan?

It’s important to shop around to find the best car loan for your circumstances. When comparing car loans, it’s worth considering both the price (including interest rate and fees) and features (for example, can you pay off the loan early?). To help consumers compare their options, Canstar researches and rates over 200 products from over 70 providers as part of its Car and Personal Loan Star Ratings.

How does Canstar compare car loans?

Canstar compares car loans using a unique and sophisticated Personal and Car Loans Star Ratings methodology, which looks at both price and features. The ratings represent a shortlist of products, enabling customers to narrow down their search to products that have been assessed and ranked.

Some of the features Canstar considers for car loans are:

• total cost including the interest rate, upfront fees and ongoing fees
• loan purpose
• security requirements
• repayment requirements and options
• redraw, top up, offset and switching facilities
• online self service for the loan

Features are evaluated and weighted that impact consumers throughout the loan process, from researching product information through to the application and settlement process, loan management, customer service, and loan closure options.

You can compare car loans based on your own requirements using the comparison selector tool at the top of the page.

Car loan rates in 2025

As you can see from the products listed in our comparison tool at the top of this page, interest rates on car loans can differ widely. They also tend to change regularly, as lenders compete for customers. If you’re car shopping and need to borrow money for the purchase, it can pay to also shop around a range of car loans.

Looking for the cheapest car loan?

If you’re looking for finance to buy a car, you might think that signing up for the cheapest car loan you can find is the way to go. It’s worth keeping in mind that going with the lowest interest rate won’t necessarily mean you’re getting the cheapest car loan deal overall.

Upfront and ongoing fees can eat into some of the money you’d save in interest, while the features you get with the loan may boost the value you’re getting overall. For example, a car loan with a slightly higher interest rate that allows you to make extra repayments and pay off the loan early without penalty might better suit the needs of some borrowers, helping them get ahead faster than a ‘cheapest’ car loan rate might.

It can be a good idea to watch out for car loans that appear cheap but which require a balloon payment in order for you to own the car. This is a one-off lump sum payment at the end of the loan term that can add significantly to the cost.

What are the lowest car loan interest rates?

You can use Canstar’s comparison selector tool (at the top of the page) to find the lowest car loan interest rates from providers in our database. Simply compare loans and filter the results by the lowest advertised rate.

You might also want to check out the comparison rate. A comparison rate takes into account the interest rate plus most ongoing fees and charges. It’s designed to give you a more accurate estimate of the total cost of the loan per year.

About our finance experts

Josh Sale, Car Loan Ratings Manager

As Canstar’s Ratings Manager, Josh Sale oversees the methodology and delivery of Canstar’s Car Loan Star Ratings and Awards. With tertiary qualifications in economics and finance, Josh has worked behind the scenes for the last five years to develop Star Ratings and Awards that help connect consumers with the right car loan for them.

Josh is passionate about helping consumers take a proper look under the bonnet of their car loan, whether it’s the interest rate, the fees or the features on offer from the lender. He says the emergence of new car loan providers is good news for consumers looking to shop around beyond the major, established lenders.

As one of Canstar’s spokespeople, Josh has been interviewed by media outlets such as the Australian Financial Review, news.com.au and Money Magazine. He has also written for a range of publishers on topics including the range of electric cars available in Australia and how your credit score can impact your loan application.

You can follow Josh on LinkedIn, and Canstar on Twitter and Facebook.

Nina Rinella, Editor-in-Chief 

As Canstar’s Editor-in-Chief, Nina heads up a team of talented journalists committed to helping empower consumers to take greater control of their finances. Previously Nina founded her own agency where she provided content and communications support to clients around Australia for eight years. She also spent four years as the PR Manager for American Express Australia, and has worked at a Brisbane communications agency where she supported dozens of clients, including Sunsuper and Suncorp.

Nina has ghostwritten dozens of opinion pieces for publications including The Australian and has been interviewed on finance topics by the Herald Sun and the Sydney Morning Herald. When she’s not dreaming up ways to put a fresh spin on finance, she’s taking her own advice by trying to pay her house off as quickly as possible and raising two money-savvy kids.

Nina has a Bachelor of Journalism and a Bachelor of Arts with a double major in English Literature from the University of Queensland. She’s also an experienced presenter, and has hosted numerous events and YouTube series.

You can follow her on Linkedin, or Canstar on Facebook.