Lower Rates With a Secured Car Loan
A secured car loan is the most common and cost-effective way to finance a vehicle purchase in Australia. With a secured loan, the vehicle you are purchasing acts as collateral for the loan, which means lenders can offer lower interest rates compared to unsecured finance. Frontline Car Loans compares secured car loan rates from over 30 lenders to find you the best deal in Perth.
What Is a Secured Car Loan?
A secured car loan uses the vehicle itself as security against the amount borrowed. The lender places a charge or lien on the car until the loan is fully repaid. Because the lender has an asset to fall back on if repayments are not met, the risk to them is lower — and that lower risk translates directly into a lower interest rate for you.
Once you have made all your repayments and the loan is paid off in full, the security interest is removed and you own the vehicle outright with a clear title.
Benefits of a Secured Car Loan
Lower interest rates: Secured car loans consistently offer lower rates than unsecured personal loans or credit cards. The difference can be 2 to 5 percentage points or more, which adds up to significant savings over a 5 to 7 year loan term.
Higher borrowing amounts: Because the vehicle provides security, lenders are willing to approve larger loan amounts. This gives you more flexibility in choosing the car that best suits your needs.
Longer loan terms available: Secured loans can be structured over terms from 1 to 7 years, allowing you to spread repayments and keep them affordable.
Fixed or variable rates: You can choose between a fixed interest rate — giving you certainty that your repayments will not change — or a variable rate that may offer lower initial repayments with the possibility of rate adjustments over time.
Available for new and used cars: Whether you are buying a brand new vehicle from a dealership or a quality used car from a private seller, a secured car loan can be arranged.
Secured vs Unsecured Car Loans
The key difference is that a secured loan uses the vehicle as collateral while an unsecured loan does not. Unsecured loans carry higher interest rates because the lender takes on more risk. An unsecured loan may suit you if you are buying a very old vehicle that does not meet minimum age requirements for a secured loan, or if you need the funds for a purpose other than a specific vehicle purchase.
For most car buyers in Perth, a secured car loan will be the better option because of the lower rates and higher approval amounts.
Eligibility Requirements
To qualify for a secured car loan through Frontline Car Loans, you generally need to be an Australian citizen or permanent resident aged 18 or over, have a regular source of income, and be purchasing a vehicle that meets the lender’s age and condition criteria. Most lenders require the vehicle to be under 12 to 15 years old at the end of the loan term for a secured arrangement.
Get a Secured Car Loan Quote
Find out how much you could save with a secured car loan. Call Frontline Car Loans on 1300 857 130 or request a free quick quote online. We will compare rates across 30+ lenders and present you with the best options in minutes.