Rent to Own Cars

Low Credit? What Are Your Options?

An advantage of rent-to-own car agreements, is that they can be set up quickly and easily - often with no credit checks and, generally, with the option to purchase at the end of the rental term.

However, there are other options available if you have credit concerns, which we may be able to help you with.

When you apply with us:

  • Bad credit approvals possible
  • Cars, motorbikes, caravans, boats and more…
  • No deposit options available
  • Free credit check report with no mark on your file
  • Apply & get approved even with Centrelink income possible
  • Easy application with fast approval decisions
  • Personalised & FREE lending assessment
  • Affordable terms to suit your needs

Note: Rent-to-own car agreements are not available via Rapid Finance, but we could assist with alternative car loan options for people with bad credit. To qualify, you must be an AU citizen or permanent resident, earn over $700 per week and have unpaid defaults under $5K.

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What Are Rent to Own Cars?

"Rent-to-own" cars are a type of agreement where you make regular rental payments on a vehicle, typically with the option to buy it at the end of the rental period. This arrangement combines elements of both car rental and car purchase, providing a path to ownership for those who may not qualify for traditional car financing due to very bad credit, no credit history or other issues.

An alternative solution, is a bad credit car loan. See below, how they compare.

How Rent to Own Agreements Compare with Bad Credit Car Loans:

Bad credit car loans and rent-to-own car agreements both provide options for individuals or businesses with poor credit or limited financial history to acquire a vehicle, but they differ in structure, terms, and implications for ownership and credit. At Rapid, we get many customers interested in rent-to-own, as an option, who end up choosing a bad credit car loan option instead. Here's a comparison of the two:

Credit Check Requirements and Approval:

Bad Credit Car Loans: These require a credit check, but the criteria are less stringent compared to standard car loans. Approval is often based on a stable income or your overall situation, rather than credit score alone.

Rent-to-Own Car Agreements: Typically, no credit check is required, making this an attractive option for those with very poor credit or no credit history.

Vehicle Ownership:

Bad Credit Car Loans: You gain immediate ownership of the car, but the lender has a legal right to take it back if you don't repay the loan in full.

Rent-to-Own Car Agreements: You do not own the car during the rental period. Ownership is typically only transferred after all payments are made, assuming the agreement includes an option to buy.

Payment Structure:

Bad Credit Car Loans: You make weekly, fortnightly or monthly loan payments, which include interest. The rate could be significantly higher due to the perceived risk of lending to individuals with bad credit.

Rent-to-Own Car Agreements: Payments are often made weekly or bi-weekly and are typically higher than loan payments because they combine rental fees and contributions toward purchase.

Costs and Fees:

Bad Credit Car Loans: Interest rates may be higher (due to the risk to the lender), and there might be additional fees, but these costs are spread out over the loan term.

Rent-to-Own Car Agreements: There could be higher overall costs due to rental fees, and some agreements may require a large final payment to purchase the car.

Impact on Your Credit:

Bad Credit Car Loans: If reported to the credit reporting bodies, timely payments could help improve your credit score.

Rent-to-Own Car Agreements: These agreements are not typically reported to credit agencies, so they may not help in building or improving your credit score.

Contract Flexibility and Terms:

Bad Credit Car Loans: The contract is binding, and early repayment may come with penalties.

Rent-to-Own Car Agreements: These might offer more flexibility to return the car without purchasing, but terms can vary widely, so it's crucial to understand the agreement fully.


While both options provide avenues to vehicle ownership for those with poor credit, the choice between them depends on individual circumstances, financial stability, and long-term goals. Bad credit car loans offer a path to improve credit and achieve ownership with predictable costs, while rent-to-own agreements offer more immediate, flexible access to a vehicle with potentially higher overall costs and less impact on credit improvement.

Note: While Rapid Finance do not offer rent-to-own car agreements, we can review your options and goals with you and often assist with a bad credit car loan solution or suggest ways to improve your credit, before applying for a car loan.

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Rent to Own Cars - FAQs