Want to pay off your car loan faster? » Car Money

Want to pay off your car loan faster?

So you’re buying a new car and you need to get a loan? That doesn’t mean you have to be in debt for the next five years. If you’re planning on conquering your car loan quickly, take a look at these five tips to paying it off fast.

1. Make your budget realistic, but tough

Setting a budget for a car loan can be tricky. You need to push yourself to pay as much as possible. But of course, at the same time, it’s important to make sure you can make your repayments.

Start by working out your budget in detail and understanding what’s going in and out of your account every month. Then, take what’s left, subtract the cost of running your car, and try having a play with a repayment calculator to see how quickly you could pay off your loan.

2. Be prepared to make compromises

The easiest way to bring down the cost of borrowing is to plan to borrow less. Take a look at the car you want to buy and make sure you’ve chosen the right model for your budget. If you’re finding it’s a struggle to afford, it might be worth asking an expert(?) if there’s a smarter way to spend your money.

3. Be aware of the cost of borrowing

The less money you pay in fees, charges and interest; the more you can put into paying off your car loan. Before you sign up make sure you’re aware of every cost. Take some time to review what’s available in the market and if necessary do some negotiation to get the best deal.

4. Don’t miss a payment

Your car loan provider may offer you the chance to take a payment break. Missed payments increase interest costs and lengthen the life of your loan (even if they’re approved up front). If you want to pay off your car loan fast: make every payment count.

5. Review regularly

Even if you’re paying your car loan off fast, it may be possible to do it faster. Keeping costs down will make it possible to do more to chip away at the principle. An annual review of your car loan position will allow you to check that you’ve got the best deal on the market. Remember to factor in the cost of switching before you make any changes.

Apply now

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure the content is correct, the information provided is subject to continuous change. Please use your discretion and seek independent guidance before making any decisions based on the information provided in this article.


*Fixed interest rates for vehicle and personal loans range from 9.95% p.a. to a maximum of 29.95% p.a. on a minimum 12 month to a maximum 60-month loan term. The actual interest rate charged to you will depend on your circumstances, the type of lending required, the security provided, and is determined by the lender. 

Fees apply, including an establishment fee of up to $450 and an introducer fee of up to $995. Also, lenders may charge a PPSR fee of between $0 and $14. For example: On a loan of $5,000 over 12 months at 10.95% p.a. with Establishment and Introducer fees totalling $495 and a PPSR Fee of $7.39, the total amount to repay is $5,835.93 which is 12 monthly payments of $486.34. Those amounts don’t include ongoing fees, such as Service Fees, charged by the lender. You can find full fee information in the loan contract. We recommend that you check the fees before accepting the loan offer.

Approval is subject to meeting lending criteria, and affordability test applies. Our lender will independently assess whether you are eligible for a loan.

One hour application decision subject to affordability test, the applicant meeting the lending criteria and supplying all the required information to process the loan application.

Same day payout subject to the applicant meeting the above conditions and completing loan documentation by 12pm.