Australian Car Loan Calculator

Car loan interest rates in Australia (2026)

What a car loan really costs comes down to three things: the interest rate, the fees (captured in the comparison rate), and the loan term. As of mid-2026, secured car loan rates average around 7.48% p.a. for prime borrowers and closer to 8.92% p.a. across all credit profiles. New-car rates span roughly 5.09%–9.99% p.a., while the RBA's average fixed-term personal loan rate (which includes car loans) sits near 9.06% p.a. Use the calculator above to turn a rate into a real monthly repayment and total interest figure.

Always compare the comparison rate, not the headline rate

Under Australian consumer-credit law, lenders must show a comparison rate alongside the advertised rate. It rolls the interest rate together with most standard fees (establishment, monthly account-keeping) into one annual percentage, so it's the only fair way to line up two loans. A 6.99% loan with high fees can cost more than a 7.49% loan with none — the comparison rate is what exposes that.

Secured vs unsecured — and why EVs are cheapest

Three factors move your rate more than anything else:

• Security. A secured loan uses the car as collateral, so rates start from around 5.66% p.a. An unsecured loan has nothing backing it, so rates run several points higher.
• New vs used. New cars attract the lowest rates; used cars cost more because they're a higher risk to the lender, and many lenders cap the age of the car at the end of the term.
• EV / green discount. Around 40% of lenders discount loans for electric and plug-in hybrid vehicles — green car loans start near 5.69% p.a., typically 1.2–1.7 points below standard secured rates.

Watch the balloon (residual) payment

A balloon is a large lump sum (often 30–40% of the car's value) deferred to the end of the loan. It cuts your monthly repayment, which looks attractive — but you still owe that amount, and you pay interest on the whole balance the entire term, so the total cost is higher. Only use a balloon if you have a concrete plan to pay or refinance it. The calculator above lets you see monthly cost with and without one.

Worked example: $35,000 car over 5 years

A $35,000 secured loan at 7.5% p.a. over 5 years costs roughly $701/month and about $7,060 in total interest. Drop the rate to a 5.69% green-car rate and the repayment falls to about $672/month and ~$5,300 interest — a ~$1,700 saving over the loan for the same car. Stretch the same loan to 7 years and the monthly drops but total interest climbs by roughly $3,000. Small rate and term changes move the number a lot — which is the whole point of comparing.

6 ways to get a lower car loan rate

• Choose a secured loan over unsecured where you can — it's the single biggest rate lever.
• Buy an EV or PHEV if it suits you — green discounts are real and meaningful.
• Keep the term short — 3–5 years costs far less interest than 7.
• Skip or minimise the balloon unless you have a clear payoff plan.
• Tidy your credit — a clean file moves you toward prime (~7.5%) and away from the ~8.9% all-borrower average.
• Compare via a broker — they reach lenders you won't find on a dealership finance desk, where rates are often marked up.