Used Car Loans

Frequently Asked Questions

• What is a secured car loan and how does it work?

  Secured car loans are one of the most popular car finance products available in Australia today. Under a secured car loan, a lender supplies a borrower with funds, which are to be used for the purpose of purchasing a vehicle; this vehicle can be new or used.

  The borrower then repays the borrowed amount over a 'loan term'. The benefit for the borrower is that they get a car without having to pay the full cost upfront, while the lender makes a profit through interest.

  The vehicle purchased is considered 'security' on the loan. If the borrower defaults on the loan, then the lender will repossess the vehicle, so they can sell it and recover their costs. If the sale of the vehicle does not cover the entire debt, then the lender will pursue the amount remaining.

• How do new and used car loans compare?

  It's true that secured used car loans tend to have higher interest rates than secured new car loans. This is because, with a secured car loan, the vehicle is usually used as security against the loan. As used cars are generally worth less (in dollar terms) than new cars, the security is worth less.

  Therefore, should the borrower default on the loan, the lender can recover less of their costs. To compensate for this, lenders often charge higher interest rates on used car loans.

  While this is not always the case, it is important to consider these potentially higher costs when choosing a used car. If you're looking to save money, it may be worth considering a new car and a secured new car loan. Because, despite a higher purchase price, a new car may save you money in the long term.

• Will a used car save me money?

  Possibly. By buying a used car, you can often avoid the worst of a vehicle's depreciation curve. Cars, can in some cases, depreciate more during their first year on the road, than during the following three years combined. So, by buying used, you can beat that initial drop in value.

  Of course, used cars are generally cheaper to buy. They could also be cheaper to insure. Shop around and you may find a bargain, although you'll have to be fast as great deals do go quickly.

  Used cars can be more expensive to finance. However, these costs may be offset by the aforementioned savings. When choosing a new or used car, it is important to look at all costs, to determine which is cheaper overall.

• Can I apply for a used car loan?

  Yes! At Rapid Finance, we are specialists in car finance. So, whether you're after a new or used car loan, we can help you to seek out finance that matches your needs and circumstances.

  You can apply over the phone, or you can submit your application on our website. Our online application form can take just minutes to complete, plus its available 24 hours a day, seven days a week.

  All we need is some personal details, basic employment information, and a description of the used car which you would like to purchase. Click here to apply online now.

• How much can I borrow for a used car?

  How much you are able to borrow or your 'borrowing power' is determined by a range of factors. These factors include, but are not limited to, your income, financial position, and credit history.

  Used cars are typically less expensive that their new counterparts. This means the security on the loan (the vehicle purchased) is worth less and this could affect your access to cash.

  Ultimately, the amount an individual is eligible to borrow is decided by the lender on a case by case basis. For a free guide to your potential borrowing power, check out the borrowing power calculator.

• Can I get 100% finance on a used car?

  Yes, in some cases 100% finance, also known as a 'no deposit loan' will be available. Should you be approved for 100% finance, then you will be able to buy your used car without an upfront cash deposit.

  As with all car finance options, whether or not you are eligible for a no deposit loan will depend on your financial position and credit history. Those with a poor credit history, for example, may find it more difficult to obtain 100% finance.

  It's important to remember that monthly repayments are typically higher with a no deposit loan. This is because, from the outset, you have 100% of the vehicle's value to repay, rather than 90% or 80%; that first 10% or 20% being the amount that would be covered by a deposit.

• When can I get my used car loan approved?

  In some cases, used car loans can be approved the same day. Typically, however, approval will take 1 - 2 days, depending on your application and financial position.

  The approval process may take longer should additional or revised documentation be required. For the speediest approval, ensure all documentation is complete and ready to go before applying.

• Can I apply for a used car loan with bad credit?

  Yes! At Rapid Finance, our loan specialists are experienced in helping Australians with less-than-perfect credit histories. We could help you to find suitable finance, even if you've had difficulties in the past.

  We focus on your financial strengths, such as your income, job history, and residential history to help you build your case for used car finance. We can even check your credit history for mistakes, and assist in correcting them for free.

  So, if you think you can't get a used car loan because of credit defaults, previous bankruptcies, or because you've been denied elsewhere, call us, we may be able to help you.

• Can I apply for a used car loan while on Centrelink payments?

  Yes! At Rapid Finance, we regularly work with customers who are receiving Centrelink payments. These payments include parenting benefits, rent assistance, pensions, as well as others.

  However, not all Centrelink payments are judged equally by lenders. Therefore your borrowing power may be affected by the type of payment that you are receiving.

  For information specific to your Centrelink payments, speak with a Rapid Finance loan specialist.

• How can I get started with Rapid Finance?

  The Rapid Finance process features just 3 steps. The first step is, you apply, you can do this online anytime or you can call us for a free over-the-phone finance assessment.

  Step 2 is we find finance. As a Rapid Finance customer, you'll have a dedicated loan specialist, they'll work with you to seek out finance that matches your needs and situation. Then with access to a huge range of finance products, your specialist will find a loan that is suitable for you.

  And the final step? You could drive in your new car. So, don't wait, get started with our simple 3 step process today! Apply online now.