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Unsecured Car Loans

Jump straight into the freedom of true ownership when you buy your dream ride with an unsecured car loan. Use our product table and calculator to compare car loans without collateral below. These handy tools will help steer you towards options that suit your budget and needs so you can hit the road sooner.

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5 months

Pay ZERO fees on all loans with NOW Finance. That's right - no establishment fee, no monthly fees, no early payout fee on all loans between $8,000-$50,000. What's more, get your guaranteed, tailored interest rate in two minutes without impacting your credit score. Comparison rate can vary from 6.75% to 26.95% p.a.*

Driva - Unsecured Car Loan

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Use Driva's platform to compare rates and choose the best car loan option for you. Making car financing fast, simple & transparent with Jump Payments.

Variable Rate Personal Loan

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Whether you're upgrading your ride or adding to your garage, a NAB Personal Loan gives you a great rate. If you are an existing customer and apply in- store by 2pm, you could walk away with your money that very same day
Bank of Melbourne

Unsecured Personal Loan

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Buy the type of car or vehicle you want with interest rates from 12.99% p.a. (comparison rate 14.06% p.a.)
Commonwealth Bank

Fixed Rate Personal Loan

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We have dropped the rate on our 5 and 6 year loan terms.

Fixed Rate Personal Loan

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Whether you're upgrading your ride or adding to your garage, a NAB Personal Loan gives you a great rate. If you are an existing customer and apply in- store by 2pm, you could walk away with your money that very same day
Credit Union SA

Variable rate car loan

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The variable rate personal loan is unsecured.
Arab Bank

Unsecured Personal Loan

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An Arab Bank Australia Personal Loan is a great way to purchase the car you want or need now, if you currently don't have the savings or cash to make your purchase. provides factual information in relation to financial products. While attempts to make a wide range of products and providers available, it may not cover all the options available to you. Moreover, we cannot be responsible for changes made to this information by product providers and/or inaccurate information obtained from a product provider. All product information comes from the product provider or publicly available information and to the best of our knowledge is correct at time of publishing. The information published on is general in nature only and does not consider your personal objectives, financial situation or particular needs and is not recommending any particular product to you. If you decide to apply for a product you will be dealing directly with that provider and not with recommends that you read the relevant PDS or offer documentation before taking up any financial product offer. For more information please see's Terms of Use and Services Guide.

Minimum and maximum loan periods vary between 6 months and 10 years. Comparison interest rates vary between 6.55% and 19.07% p.a. Total interest repayments vary between $4,290 and $14,531 over the life of the loan. *Comparison rate is based on an unsecured loan of $30,000 for a term of 5 years. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. These rates can change without further notice. All rates quoted are per annum. For more information regarding fees click on "View fees & additional info +" for each product or contact the provider.

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Unsecured car loans – Get full instant rights to your auto

Unsecured car loans allow you to borrow the money you need to buy a car, but without needing to anchor the vehicle or any asset to the deal. That means the lender won’t have the option to wrestle the wheel from you if you fail to repay the loan. While there’s obviously less risk for you, this typically comes at a cost.

BestFind reveals what you need to know about unsecured car loans and weighs up the pros and cons of this no-collateral option.

How do unsecured car loans work?

Unsecured car loans offer a less risky way of financing your new or used car. But, by not attaching the vehicle as collateral, you’re essentially offloading the risk to the lender, who no longer has a backup plan to repossess if you default.

Usually, the lender isn’t just about to let this happen unless your creditworthiness proves to be worth its own weight in gold. But, in addition to having a tip-top credit rating and a sufficient, dependable income, you’ll also need to pay a higher interest rate to further insure the lender from potential loss.

Aussie borrowers usually opt for unsecured loans for the following reasons:

No suitable assets to offer

This usually happens when buying a preowned car that’s depreciated in value. The vehicle might not fall within the general upper age limit of around 10 or 12 years. Also, older cars are more prone to breakdowns and write-offs, so the lender won’t gain much by selling it off if you default. If you have no other alternative assets to bring to the table, then an unsecured car loan is a viable option.

Fewer restrictions

With secured car loans, the amount you can borrow depends on the car’s value. For example, if the vehicle is only worth $25,000, the lender will want to extend only this amount or less. This ensures they get back their money in full if they have to sell. Unsecured loans have no such restrictions. You’re generally able to borrow extra to cover other related or non-related costs.

Not willing to risk losing the car

If your new ride is your pride and joy, you may not be willing to risk losing it, especially if you can’t guarantee zero mishaps during the repayment process.

Unsecured vs secured car loans

If you’re still figuring out your car finance options, you might want to take a quick detour to look at secured car loans. In contrast, these require collateral, which means you grant the lender access to your car if you default.

The lender can then sell the vehicle to recover their money. Since repayment is guaranteed in any case, there’s less financial risk. Lenders usually, therefore, levy lower rates and fees to push their secured financial products forward.

Types of unsecured car loans – Fixed or variable

  • Fixed rate. True to its name, a fixed-rate loan has an interest rate that stays in place for the loan’s entire term. Locking in has the benefit of keeping your budget and repayments stable. However, avoiding an increase in repayments means you also avoid savings when the rate goes down.
  • Variable rate. Variable-rate loans are also suitably named since their interest rates vary based on the Bank of Australia cash rate. Lenders can always pass up on making adjustments, but if they do, you’ll also need to adjust your budget just as frequently. Another downside is having to pay more out of pocket if your repayments increase. The biggest advantage, however, is being able to save if the rate falls.

What to watch out for when comparing unsecured loans

Comparing loan options is one step you can’t afford to miss if you want to target the best loan products. Use the following checklist to make the most of your shopping experience:

  • Comparison rate. A low interest rate might always be the standard choice, but you’ll also benefit from choosing a low comparison rate. The comparison rate is another percentage that gives you a better clue about the real cost of the loan. That’s because it bundles together the interest rate and other fees and charges.
  • Extra fees. Besides standard loan charges such as establishment fees and ongoing monthly or annual fees, there might be additional fees not included in the comparison rate. These could be early repayment fees or redraw fees, which activate when you carry out specific actions. Scrapping these extra fees ensures your loan stays flexible and cost-effective. For instance, you’ll be able to pay off your debt and save. Alternatively, a redraw facility allows you to win back any extra repayments made should you need them.
  • Maximum amounts. Check to see which LVR you’ll end up with. The loan-to-value-ratio is expressed as a percentage that indicates the amount you owe compared to the car’s value. A 100% LVR, for instance, means the lender initially helps to cover the full cost of the vehicle. However, you might have to pay a deposit upfront because of the greater risk to the lender.

Should you take out an unsecured loan to buy a vehicle?

Weigh the following pros and cons of unsecured loans before making a final decision:


  • You might be able to borrow extra funds for other purposes
  • No restrictions on the type of vehicle you can buy
  • There’s no risk of losing your car


  • Your interest rate will be higher than that for secured loans
  • Stricter lending criteria since you usually need a good credit rating and a stable income
  • Failure to repay can still damage your credit history or land you in legal trouble

How to apply for unsecured car finance

  • Compare unsecured car loans. Use our comparison tables above to close in on the option most suited to your needs. As mentioned earlier, it’s best to check the interest rate, comparison rate, fees, and maximum amounts before settling.
  • Use our unsecured car loan calculator. You can also compare deals using our car loan repayment calculator. Enter your amount and term, and it will tell you the monthly repayments for each offer. Generally, longer terms result in smaller repayments, but these build up to a higher cost in the long run. A shorter loan term means you avoid paying more interest by making larger or additional repayments.
  • Apply. Once our comparison table offers up a lender that matches your needs and budget, you can click their “Go to Site” button. To complete the online application on the lender’s website, you’ll need to be at least 18 years. You should also have your identity and financial documents close by.

Unsecured car loans FAQ

Can I borrow extra to cover on-road and insurance costs?

Generally, yes. The car’s value won’t restrict your borrowing capacity.

Will I get approved if I have bad credit?

Some credit providers offer unsecured bad credit car loans, but keep in mind the rates will be much higher.

Can I use the money to buy a car from a private seller?

Yes, you can also buy from a dealer, an online marketplace, or an auction.

How long do I have to pay off my debt?

Car loan terms range from one to seven years on average.

Can I refinance an unsecured loan?

Yes, you can apply for a different loan with better terms. You then use the funds to pay off your existing debt.

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