Most Australians prefer to buy used instead of new when it comes to cars. The Australian Automotive Dealer Association (AADA) reported that 2,324,805 used vehicles were sold in 2024 in its Automotive Insights Report. That’s almost double the number of new car registrations recorded over the same period, according to VFACTS data. AADA found that 60.9% of all used car sales in 2024 came from private listings, with the other 39.1% sold through dealerships.
Whether you’re going for a demo model or something older, buying from a dealership or an online listing, taking out a car loan allows you to pay for your vehicle in instalments, rather than taking a big financial hit upfront.
Used car financing options
Before you dive into your used car finance options, though, it’s worth looking at the qualification criteria your car will need to meet before you can be approved for a loan.
- Age: lenders will often enforce age limits on cars, which are often between ten and 15 years old at the end of the loan term. However, some may extend this to 20, while others may not have an age limit at all.
- Write-off history: many lenders will require that a car mustn’t have been written off previously. This isn’t always the case, though, as a repairable write-off could be financed through certain lenders.
- Car value: even if your car passes all the checks, you can’t generally borrow more than its overall value. There are certain situations where you may be able to do this, such as covering on-road costs like insurance, registration and stamp duty.
The majority of used vehicles financed through Savvy have a loan size of just over $32,000 and, on average, are five years old. When it comes to used cars, there are three main types of vehicles you’ll be able to buy:
Demo cars
Demonstrator (or ex-demonstrator) models, commonly referred to as demo models, are usually display or test drive vehicles at dealerships. They’ll often have a few hundred to a few thousand kilometres on the odometer, so they aren’t brand new, but they’re newer than other used cars.
Because of the low mileage, you can pick one up for less than a brand-new model, making them an attractive option if you want something near-new without paying full price. That said, demo cars are usually the priciest of the used options.
Used cars from a dealership
Buying from a used car dealership includes a warranty, covering mechanical issues for a set period (usually three months). This adds peace of mind, as the vehicle is likely to be inspected and maintained (though an independent check is still wise).
You can also trade in your current car to reduce the purchase cost and remove the headache of selling your vehicle. However, prices through a dealership are usually less negotiable due to dealer margins, and you may encounter unnecessary upselling from sales staff.
Used cars from a private sale
The number one benefit of buying privately is the cost of the car. Without any overheads or sales targets to meet, a private vendor can choose to sell their car at whatever price they like. This could mean major savings for you and a smaller loan as a result.
What buying from a private seller doesn’t give you is much protection. If you were to buy a lemon, you’d likely be stuck with it. Because of this, it’s especially important to conduct vehicle history checks and get the car independently inspected before any money changes hands. Also, while making contact with the seller and agreeing on a price might be easier, the admin involved in selling a car is up to the two of you to sort out.
Used car loan interest rates
As of 15 July 2025, the best used car loan rates available through Savvy are as follows:
| Lender | Interest rate from | Comparison rate from | Loan amount |
|---|---|---|---|
| Bank of Queensland | 6.48% p.a. | 7.74% p.a. | $4,000 – $100,000 |
| Angle Auto | 6.50% p.a. | 8.26% p.a. | $5,000 – $150,000 |
| Pepper | 6.59% p.a. | 7.93% p.a. | $5,000 – $150,000 |
| Automotive Financial Services | 6.79% p.a. | 8.55% p.a. | $5,000 – $130,000 |
| Liberty | 6.79% p.a. | 8.34% p.a. | $5,000 – $100,000 |
| Wisr | 6.79% p.a. | 8.29% p.a. | $10,000 – $150,000 |
| Plenti | 6.85% p.a. | 8.40% p.a. | $5,000 – $100,000 |
| Firstmac | 6.99% p.a. | 8.12% p.a. | $5,000 – $150,000 |
| RACV | 7.29% p.a. | 8.00% p.a. | $5,000 – $150,000 |
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Note: rates are calculated based on a $30,000, five-year car loan for a three-year-old vehicle bought by an asset-backed applicant. |
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It’s worth noting that rates change depending on a range of factors. One such example is the age of the car. The table below shows the difference in what you can expect to pay based on a five-year-old car, instead of a three-year-old model:
| Lender | Interest rate | Comparison rate | Loan amount |
|---|---|---|---|
| Bank of Queensland | 6.48% p.a. | 8.00% p.a. | $4,000 – $100,000 |
| Pepper | 6.59% p.a. | 8.28% p.a. | $5,000 – $150,000 |
| Plenti | 6.95% p.a. | 8.82% p.a. | $5,000 – $100,000 |
| Firstmac | 6.99% p.a. | 8.35% p.a. | $5,000 – $150,000 |
| Angle Auto | 7.00% p.a. | 9.10% p.a. | $5,000 – $150,000 |
| Automotive Financial Services | 7.29% p.a. | 9.40% p.a. | $5,000 – $130,000 |
| Metro | 7.54% p.a. | 9.13% p.a. | $5,000 – $250,000 |
| Wisr | 7.54% p.a. | 9.34% p.a. | $10,000 – $150,000 |
| Branded Financial Services | 7.60% p.a. | 9.16% p.a. | $5,000 – $250,000 |
| Liberty | 7.65% p.a. | 9.52% p.a. | $5,000 – $100,000 |
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Note: rates are calculated based on a $25,000, five-year car loan for a five-year-old vehicle bought by an asset-backed applicant. |
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Although you can see the minor differences on offer from certain lenders, you should always unpack what that might mean for your car loan. We’ve taken a look at three example lenders to see how these minor differences in interest rate impact your repayments:
| Lender | Interest rate (three-year-old car) | Monthly repayment | Total interest paid | Interest rate (five-year-old car) | Monthly repayment | Total interest paid |
|---|---|---|---|---|---|---|
| Lender A | 6.50% p.a. | $490 | $4,350 | 6.75% p.a. | $493 | $4,526 |
| Lender B | 6.60% p.a. | $491 | $4,420 | 6.97% p.a. | $495 | $4,681 |
| Lender C | 6.85% p.a. | $494 | $4,596 | 7.35% p.a. | $500 | $4,951 |
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Calculations based on a $25,000, five-year car loan. Rates are for illustrative purposes only and don’t necessarily reflect differences in interest for three and five-year-old cars, nor the rates you’ll receive on your car loan. |
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As you can see, even a difference of a few dollars each month can add up to hundreds in interest over the life of the loan. It’s important to mention that, on average, the cost of a five-year-old car will be less than that of a three-year-old car, but for the purposes of this comparison, all calculations were based on the same $25,000, five-year loan.
Why apply for a car loan with Savvy?
How to apply for your car loan with Savvy
Whether you’re just having a poke around at a few dealerships to see what’s available or you’ve locked in your sale price with an online vendor, Savvy is here to help you finalise your used car purchase. Here’s our process:
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Complete our simple online form
Start by telling us about yourself and your profile, as well as the loan you’re looking for to purchase your car. We’ll need to know things like your income, employment and credit history.
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Supply any necessary documents
As part of our initial assessment process, we may need additional documents to verify aspects of your application, most commonly income and employment history.
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Have a chat with one of our expert brokers
A friendly member of our broker team will be in touch with you once they have all the information they need to discuss your potential used car finance options through one of our lending partners.
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Pick out your used car (if you haven’t already)
If you already have your car picked out, we can press ahead with things. However, if you don’t, we can help you source a model through our car broker, Vehicles Direct, and its national dealer network.
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Have your application prepared and submitted
Your broker will prepare your application for formal submission to your lender after you’ve provided all the necessary details and documents. They’ll keep you in the loop on any developments during this period.
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Sign your loan documents electronically and seal the deal
If you’re formally approved, you’ll be sent the final loan documents to sign electronically. Once you’ve done this, the funds can be sent to the seller and the car can be yours!
What’s the minimum loan size for a used car?
When it comes to car loans through Savvy, the smallest available loan size is $5,000. You might only need a small loan if your deposit is 50% or more of the purchase price or you’ve found a great deal through a private seller.
What is a good rate on a used car loan?
The lowest rate available for a used car loan through Savvy is 6.48% p.a. (7.74% p.a. comparison) as of 10 July 2025, based on a $30,000, five-year loan for a three-year-old car. However, because everyone’s profile is different, a good rate for one person might not be great for another. You can speak with your Savvy broker about your loan options and what the best rates on offer for your profile are.
