Estimate car loan repayments, total interest, and what a balloon payment does to both. Works for new and used vehicles.
Enter the amount you need to finance, the rate, the term and whether there is a balloon, and it shows the regular repayment, the total interest over the life of the loan and the total you will have paid by the end. The amount financed is the vehicle price less any deposit or trade-in. It is an estimate, not a quote: the rate a lender offers you depends on the vehicle, its age, your credit history and how you are employed, and it is only known once a lender has assessed an application.
Lenders price used vehicles differently from new ones, and many set an upper age limit for the car at the end of the loan term. A seven-year-old car on a seven-year loan will be fourteen at the end, which some lenders will not finance and others will price higher. If you are comparing a new and a used car, run both through the calculator with the rate and term each is likely to attract rather than the same figures for both.
A balloon, also called a residual, is a lump sum left owing at the end of the loan. Because the repayments only have to cover the amount less that lump sum, each repayment is lower. The trade is that you pay interest on the full amount for the whole term, so total interest is higher than the same loan with no balloon, and on the last day you either pay the balloon, refinance it into a new loan, or sell the car to clear it. Set the balloon field to 20 or 30 per cent and watch both the repayment and the total interest change, then decide whether the lower repayment is worth the larger total.
The term is the lever most people overlook. Moving a five-year loan to seven years lowers the repayment but adds two years of interest. Set the term to the shortest length whose repayment you can comfortably meet, then check what the total interest saving is against the next term up. On a car loan the difference is often larger than the difference between two lenders’ rates.
Most car loans carry an establishment fee and some carry a monthly account fee. The advertised rate does not include them; the comparison rate does. When you compare two loans, compare their comparison rates. The fee field here adds a per-repayment account fee so the repayment and total reflect it. Establishment fees are usually added to the amount financed, so include them in the amount if you know them.
Dealer finance is arranged at the moment you have chosen the car and want to leave with it, which is rarely when you compare best. Your own bank has one set of products. A broker submits one application across a panel of lenders and comes back with the ones likely to approve your situation and what each would cost. Whichever route you take, run the offer through this calculator first so you know what the repayment and the total should look like before anyone shows you a number.
Work out the repayment you can carry alongside rent or a mortgage, insurance, registration, fuel and servicing, and treat that as the ceiling rather than what a lender says you can borrow. Then check your credit report, which is free from each of the credit reporting bodies, so nothing on it surprises the lender. Our car loan page covers what lenders ask for and how long approval usually takes.
A calculator gives you a starting figure. What a lender will actually approve depends on your income, expenses, credit history and the property, and it varies between lenders. We compare more than 40 lenders on our panel and will tell you where you genuinely stand — see our home loan, refinancing and car loan services, or the suburb pages for Werribee, Tarneit and Point Cook.
It is accurate for the figures you enter, and indicative for your actual loan. The rate a lender offers depends on the vehicle, your credit history and your employment, and is only known once an application is assessed. Use it to compare scenarios and to sanity-check an offer, not as a quote.
It depends on what you want the loan to do. A balloon lowers each repayment but raises total interest and leaves a lump sum owing at the end. It suits people who plan to sell or upgrade the car at the end of the term, or who need the lower repayment now. If you intend to keep the car and clear the loan, no balloon usually costs less overall.
Most car loans run from one to seven years, with five years the most common. A shorter term means higher repayments and less total interest; a longer term the reverse. Some lenders limit the term based on the age of the vehicle at the end of the loan.
Not automatically. Establishment fees are usually added to the amount financed, so if you know the fee, add it to the amount. The fee field is for an ongoing account fee charged with each repayment.
The interest rate is the rate charged on the balance. The comparison rate adds most of the fees and expresses the true cost as a single percentage, so it is the figure to use when comparing lenders. It is calculated on a standard loan amount and term, so it is a comparison tool rather than your exact cost.
Usually yes, subject to the lender. Private-sale loans often need a PPSR check on the vehicle and a roadworthy certificate, and some lenders price them a little higher than dealer purchases. Eligibility and pricing vary by lender and are subject to their assessment.
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