Australian Car Loan Calculator

Last updated: May 2026. Reflects current Australian metrics.

Quickly calculate your car loan repayments. Factor in a balloon payment, trade-in value, and compare dealer finance against secured bank loans.

Vehicle & Loan Details

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$
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0% of vehicle price

Estimated Repayment

per month

$0
Total Loan Amount Borrowed $0
Total Interest Payable $0
Total Cost of Loan $0

Includes principal, interest, and the final balloon payment.

Buying a Car in Australia: Finance Options Explained

Whether you are buying a brand-new ute or a second-hand hatchback, securing the right car loan can save you thousands. In Australia, car loans are generally divided into secured and unsecured options.

Secured vs Unsecured Car Loans

A secured car loan means the vehicle itself acts as security for the loan. If you stop making payments, the bank can repossess the car. Because this is lower risk for the lender, secured loans offer the lowest interest rates. Note that lenders will register their interest in your vehicle on the Personal Property Securities Register (PPSR).

An unsecured car loan (which functions like a standard personal loan) does not use the car as collateral. This is often necessary if you are buying an older second-hand car that the bank deems too risky to secure against. Unsecured loans have significantly higher interest rates.

Dealer Finance vs Bank Finance

Car dealerships often advertise incredibly low interest rates (sometimes as low as 1% or 2%). While tempting, these are often subsidized by inflating the purchase price of the car or giving you a lower trade-in value. Always compare dealer finance quotes against a pre-approved loan from a bank or credit union. Using our calculator, you can check the true cost of a dealer's offer.

Balloon Payments

A balloon payment is a large lump sum owed at the very end of your loan term (e.g., $10,000 at the end of year 5). A balloon payment reduces your regular monthly repayments, making the car seem more affordable. However, because you are holding onto more debt for longer, your total interest paid over the life of the loan will be much higher. At the end of the term, you must either pay the balloon in cash, sell the car to pay it off, or refinance the balloon amount into a new loan.

Related Calculators

Car Repayments Novated Lease Balloon Payments

Learn more about car finance at ASIC MoneySmart.

10 Frequently Asked Questions

1. What is a balloon payment?
A balloon payment is a large lump sum due at the end of your car loan term. It reduces monthly repayments but increases total interest paid.
2. Secured vs Unsecured car loans?
Secured loans use the car as collateral and offer lower rates. Unsecured loans do not tie the car to the loan, but have higher interest rates.
3. What is a novated lease?
A novated lease is an arrangement between you, your employer, and a finance company where loan repayments and running costs are paid from your pre-tax salary.
4. What is a PPSR check?
The Personal Property Securities Register (PPSR) check ensures a used car doesn't have money owing on it before you buy it.
5. Are dealer finance rates better?
Dealer rates like 1% often hide costs in the car's purchase price. Always compare the total cost against a bank loan.
6. Can I pay off my car loan early?
Yes, but check for early exit or break fees in your contract, especially for fixed-rate car loans.
7. Does the comparison rate matter?
Yes, it includes upfront fees and monthly account keeping fees, showing the true cost of the loan.
8. What is Fringe Benefits Tax (FBT)?
FBT applies to novated leases, but you can offset it using the Employee Contribution Method (ECM).
9. How do trade-ins work?
A trade-in reduces the total amount you need to borrow, thus reducing your monthly repayments and total interest.
10. Should I finance over 3 or 5 years?
A 3-year term costs less in total interest but has higher monthly payments compared to a 5-year term.